The Payment Systems Regulator (PSR) has published its Annual Plan for 2022/23, to go further in making sure payment systems are fit for the future – offering access, protection and choice for everyone that uses them.
UK payments regulator sets out plan for the future
Emerging from the COVID-19 pandemic, it’s clear how essential to everyday life payment systems are, and that they must be resilient and convenient to allow people to rapidly change how they pay.
On the whole, these systems work well, notes a statement. However, the payments landscape is evolving and with this, there are issues that need to be addressed.
These include the prevalence of Authorised Push Payment (APP) fraud, risks to effective competition, and the need to support the payments sector to deliver new and improved services.
Further challenges can also be expected, as global events impact the cost of living, which may affect what people need from payments to support their daily lives.
The PSR’s ambitious work programme for 2022/23 focuses on improving outcomes for everyone who uses payment systems so they are fit for the future.
“Over the past year we’ve taken bold action to bring change in payments – and our work has made improvements for people and businesses across the UK,” says Chris Hemsley, Managing Director at the PSR.
“We’ll continue to act swiftly and decisively to make sure that consumers and businesses are protected, and to promote innovation and competition where it counts.
We have some big tasks ahead of us, including taking further steps to protect people against APP fraud and encouraging greater competition in the cards market.”
As the below sets out, the PSR’s Annual Plan is guided by the four key priorities established in the regulator’s Strategy, which launched earlier this year.
Access and choice
The PSR will continue to oversee LINK’s work to maintain the UK’s free-to-use ATM network, so people can access their cash when they need to. The regulator is also providing expert input on the regulatory framework for potential new payment systems, such as cryptoasset-based options. These new systems have the potential to increase choice and add to competition.
Protection
For payments to be made safely and with confidence, the PSR is using its powers to ensure that more people and businesses have the added security of the name-checking service Confirmation of Payee (CoP). It is also taking steps now to prepare for proposed legislative changes that should allow the PSR to act against APP fraud.
Competition
For payments to be made safely and with confidence, the PSR is using its powers to ensure that more people and businesses have the added security of the name-checking service Confirmation of Payee (CoP). It is also taking steps now to prepare for proposed legislative changes that should allow the PSR to act against APP fraud.
Unlocking account-to-account payments
A particular focus for the PSR is looking at how account-to-account payments could provide credible alternatives to card payments in retail.
UK Payments – Card Payments
Perhaps the area where the PSR has most focused its investigative efforts in 2020 and 2021 is in card payments, and it may continue in 2022.
The first action was in the card-acquiring services. The PSR conducted a market review of this market in 2021; as a result, it is now trying to inject more competition-proposing remedies that would facilitate merchants to compare and switch payment providers.
This investigation also revealed that scheme fees have increased over the years, as well as cross-border interchange fees. For the PSR, “these developments pose important questions around whether there are sufficient competitive constraints on card schemes.”
These findings led the PSR to investigate the increases in card schemes fees, and the regulator is in the process of collecting information to “help us understand the factors that affect the level and structure of these fees and the reasons behind any changes in them.”
It is likely that this investigation continues during 2022, but Self didn´t anticipate any conclusion of the investigation or whether any action will be taken.
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