Now in its second operational year, the Payment Systems Regulator (PSR) has today published its annual report for 2016/17, which reviews its work over the past year.
This year’s report highlights key achievements and milestones for 2016/17. The last 12 months have enabled the regulator to focus on the foundations set out during its first operational year, and make significant progress in addressing the issues identified to make payment systems work better for everyone.
'Payment systems underpin the economy and affect all our day-to-day lives. It’s crucial they work well and keep up with changing consumer needs. We’re still at an early point in our journey, but things are already changing – pointing to a more open and competitive future.
‘Last year saw some of our early actions bear fruit. Unprecedented numbers of new organisations are now joining payment systems; we have answered once and for all the questions around bank ownership of payment infrastructure and seen the banks divest that ownership; and we have driven a once-in-a-generation strategy for payments that will ensure the industry is able to respond to changing consumer needs. All of this will help drive better services for everyone who uses payment systems.'
Opening up access to payment systems has been a key focus for the regulator. It’s now quicker, cheaper and easier to connect directly and there are more ways to connect.
The PSR has directly intervened to facilitate a more competitive market through its work on the Infrastructure Market Review, published in June 2017. Importantly, these changes have started to open the industry to new technology providers and innovators, and help improve and create new payment services for everybody who uses payment systems.
The PSR has also worked collaboratively with the industry to drive innovation. During the course of 2016/17 the Payments Strategy Forum delivered its final strategy. This included a proposal to consolidate the operators of three payment systems and to reboot the technical architecture that the systems rely on. These bold proposals will fundamentally change the industry by creating easier access to the current payment systems, fostering more competition and enabling innovation. It will also mean delivering a payment system that is simpler, more agile and responsive to the changing needs of users.
'There are exciting developments happening in UK payments. Our work is coming together with efforts within the industry to streamline the whole payments process. The end result will be that consumers have greater control and protection of their finances.
'There’s much work for us all to do and I look forward to working towards another year in which we have made a positive difference to the people and organisations that use payment systems.’
- Payment systems infrastructure is the network by which payments are cleared and settled. This network allows us to transfer funds and make payments to other people and organisations. For example, without this network, salaries could not be paid into bank accounts, cards would be unable to withdraw cash from ATMs and we would be unable to purchase items from retailers, including online purchases.
- The Forum was created to develop a strategy for innovation where the industry needs to work together. It includes a wide range of interested parties, to ensure the right input and representation. Its chair is appointed by the PSR and independent from industry. The PSR provides the secretariat for the Forum and will intervene if its output doesn’t support its objectives. The Forum will publish its strategic priorities later this year.
- The PSR has three statutory objectives: to promote effective competition in the markets for payment systems and for services provided by those systems, including between operators, payment service providers and also infrastructure providers, in the interest of service-users; to promote the development of innovation in payment systems, in the interest of service-users; and to ensure that payment systems are operated and developed in a way that considers and promotes the interests of service-users.
- The PSR is the regulator and concurrent competition authority for payment systems in the UK and all participants in payment systems (payment service providers, operators and infrastructure providers to those payment systems).