Matthew Cherry's speech for PSE Consulting Merchant Acquiring Conference, 14 November 2018


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

Good morning, and thank you for inviting me to speak today.

Earlier this year, the PSR published draft terms of reference for a market review into card-acquiring services. We’re aiming to understand whether the supply of these services is working well for UK merchants, and ultimately consumers.

We plan to get input from a wide range of parties to inform our work. We intend to seek information and evidence not just from suppliers of card-acquiring services, and the merchants who buy those services, but also other parties that help merchants to accept cards. 

Many of you will work for firms that can help us understand the relevant issues. So, my primary aims today are to raise awareness of our work and encourage you to contribute to our market review. There are various ways to do that, which I’ll come on to talk about.

I’ll begin by giving you a short introduction to the PSR. I’ll then give you an overview of the draft terms of reference and conclude with a summary of our next steps.

I must emphasise that today’s presentation reflects what we said in the draft terms of reference. We’re currently preparing the final terms of reference so I can’t comment on whether, or how, our thinking has evolved since. That wouldn’t be fair to those not present today.

So, who is the PSR?

We are the economic regulator of the UK payments industry.

Our vision is for payment systems to work well for all who use them – for payment service providers, businesses, charities and all of us as individuals. 

This means we want them to be accessible, secure and reliable, and represent value for money.

This is supported by our statutory objectives under FSBRA – the Financial Services (Banking Reform) Act 2013, which is the legislation that created the PSR. These objectives are to promote competition, innovation, and the interests of all those that use payment systems.

We have powers to regulate payment systems designated by the Treasury. There are eight designated payment systems, including Mastercard and Visa. 

We regulate all the participants in these payments systems. That is: the operators who administer the system, the PSPs who use the system to provide payment services, and the infrastructure providers who provide the hardware, software and communications networks that allow the systems to function.

As well as being a regulator, we’re also a competition authority. Our competition powers extend to participation in all payment systems, not just those designated by the Treasury.

Since we were established, the government has also given us additional responsibilities to monitor and enforce EU legislation For example, we are the lead competent authority for the Interchange Fee Regulation, which has brought about major changes to the way that card payment systems operate.

The payments landscape is going through many significant changes, driven by new technology and