A new regulator for a new world

16/04/2015

Speech by Hannah Nixon, managing director of the PSR, at the Digital Payments Intensive on 16 April 2015 in London.

This is the text of the speech as drafted and may differ from the delivered version.


Good morning. This is the first time I have delivered a keynote speech since the PSR launched on 1 April. 
 
The last time I spoke at a gathering of this size, we were deep in the consultation process, writing and re-writing policy, sense-checking it and making sure it would deliver what we intended and would stand the test of time.
 
Now, we have a clear ambition, policy statement and work programme. And we are fully up and running.

When you leave today I’d like you to do so understanding what it is the PSR is here to do, what it is we want you to do, and – most importantly - how this will all add up to create better payment systems that work for everybody that uses them.
 
But before I go on, I’d like to reflect for a moment.

From shekels to smartphones

We all know that payment systems are important, that they underpin the economy.  We all know that the way we pay for things is changing, and, as technology develops, the options become greater.

These things have always been true, right from the early payment systems 5000 years ago when Mesopotamian traders defined units of barley as shekels.
 
Times have changed, but our needs are the same. People have always demanded payment systems that really work for them. We need to make sure we have an industry that responds.

Why the PSR was created

One of the concerns we have, and indeed one of the reasons we were set up by Parliament, is because it feels like the balance has slipped a little.

Payment systems, while well established and resilient, are not necessarily being operated with the user front of mind.
 
It is vital that we – by which I mean both regulator and regulated – keep pace.
 
In fact just recently we heard that cash is to move into second place as the most popular form of payment. Digital payments have overtaken.
 
It’s a significant moment. Together coins and paper money have been our staple for thousands of years. This ‘changing of the guard’ shows that we are moving into a new world. 
 
And so the PSR comes at a critical time. Whether it’s shekels or smartphone apps, the concept remains the same. We must have payment systems that work for those that use them. What has changed is the complexity of the markets they serve and the technology behind them. 
 
This is a new world and it needs a new regulator. Today I will tell you what we have been working on at the PSR so far, and then what we want to achieve and how we intend to regulate.

So, what have we been up to?

Last April the PSR was little more than an idea, a handful of people working on ‘the PSR project’. 
 
Fast forward 12 months and we are no longer a project; we are much much more. From a standing start we have established a brand new independent economic regulator, with a team of experts and a comprehensive set of policies and processes.

Stakeholder engagement has been a central part of our work to date, and I want to thank you for the consistently constructive and helpful input we have had from many of you here today. I certainly hope it continues.
 
I am immensely proud of what we have achieved. And while I may be biased, what we have achieved – in my opinion – is