The Payment Systems Regulator (PSR) has published its latest annual report and accounts, looking at the important work it delivered during 2022/23.
With more than 40 billion transactions every year, payment systems are a vital and ever-evolving part of our economy. Payments are an essential part of daily life and it’s the PSR’s job to make sure the systems underpinning them continue to work well for everyone.
In 2022/23, the PSR made extensive use of its regulatory powers to promote innovation and competition, helping to protect people and businesses. It directed almost 400 more firms to offer the Confirmation of Payee service as a safeguard against fraud, implemented its pro-competition remedies in the card-acquiring market, and settled two further enforcement cases. It also outlined its vision for open banking to develop in a safe, scalable and sustainable way.
As well as this, the Sterling Fnality Payment System became the newest payment system to fall under the PSR’s regulation - making it the first regulated distributed ledger technology payment system in the world.
Chris Hemsley, Managing Director at the PSR, said:
“We’ve made great strides over the last year – the first of our five-year Strategy – bringing about changes which have had a positive impact on people and payments in the UK.
“As well as moving quickly to tackle some big challenges affecting payments today, like fraud and non-compliance with our rules, we delivered work that’s shaping the future of payments.
“I look forward to continuing our ambitious, engagement-led approach into the year ahead.”
The regulator met all of the commitments set out in its 2022/23 annual plan. These include:
- Much stronger fraud protections for people and businesses. The PSR is radically changing the way the industry fights and responds to fraud. It laid the groundwork for firms to fully reimburse authorised push payment (APP fraud) victim and it directed the 14 of the largest UK payment service provider groups to publish their fraud statistics, which will happen for the first time later this year.
- Improving choice and competition in card payment services for businesses. The PSR introduced a set of measures, which have now started being implemented, making it easier for UK businesses – particularly smaller ones – to shop around for a good deal on the card payment services they need.
- Progression of the New Payments Architecture (NPA). The PSR has been engaging closely with Pay.UK as it progresses with the NPA, which will replace Faster Payments. A key milestone has been achieved, with the competitive bidding process for the procurement of the NPA infrastructure provider completed. The PSR is now focussing on making sure that Pay.UK delivers NPA in a way that benefits competition and innovation.
- Major step forward for open banking. The PSR worked closely with the FCA and other members of the Joint Regulatory Oversight Committee to set out plans for the future of open banking and how to unlock its full potential in payments.
- A greater focus on monitoring compliance. The PSR wants to make sure firms are following the rules it enforces. Over the last year, it’s taken forward important market reviews of card fees, and completed two enforcement cases resulting in fines totalling over £10m. As part of the regulator’s wider organisational redesign, a new Supervision and Compliance Monitoring division has been created to support this crucial compliance work.
The PSR’s annual report includes a progress update on its full programme of work during 2022/2023, including around the digital pound proposals, cryptoassets and maintaining free access to cash.
It’s also the first year the PSR has reported against its Strategy, improving transparency around the work it’s doing and the difference it’s making.
To find out more about the PSR’s work programme for the year ahead, you can read its 2023/24 annual plan.