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Governance of payment systems

How the industry is governed and decisions made

The PSR will open up the governance and control of payment systems to ensure that operators become more transparent and their decisions take into account the interests of the businesses and people that use payment services.

We will do this by requiring interbank system operators to:

  • address specific conflicts of interest of decision-makers
  • improve service user representation in decision-making
  • publish their board minutes to explain their decisions

We will ensure compliance with our directions through annual compliance reporting and by monitoring governance changes in payment systems.

On 15 December 2015 we published a report on access and governance, summarising the progress operators have made to create more open and flexible direct access to payment systems, and inclusive and more transparent governance. Read the report.

Interbank operators

All interbank operators will be required to ensure the interests of service-users are appropriately represented in their decision-making processes at board level.  We expect this to drive decisions that are focused on users’ interests, improving innovation and the customer experience.

They will also be required to publish board minutes and votes in a timely manner, including a statement of how independent directors have exercised their discretion with public interest matters.  This will ensure that we and other stakeholders can clearly see how they are improving the voice of service-users in their decisions.

They will need to ensure that individuals are not simultaneously a director of an interbank operator and of a central infrastructure provider to that payment system.

Interbank operators will also be required to report annually on how they have complied with our directions.

We are not applying these directions to BBCCL, the operator of the Northern Irish cheque clearing payment system.

Card operators

We will not, at this stage, require card operators to comply with the service-user direction or the publication of board minutes direction. Instead we will consider in more detail the extent to which the interests of service-users are appropriately represented in card operators’ decision-making, the transparency of their decision-making, and the appropriateness of regulatory intervention during our work around card systems.

Cards payment systems.

Service-user representation

Payment systems must work in the interests of those who use them. Governance processes need to give a meaningful opportunity for service-users to influence decision-making which affects them and their needs.

The degree of representation of those who do not have a right to appoint board directors to the boards of interbank operators is a long-standing concern. These stakeholders (for example PSPs with indirect access) and other service-users have raised concerns that they are not sufficiently represented and their views not always heard or considered by operators.

We have decided to make a general direction requiring interbank operators (except BBCCL) to ensure appropriate representation of service-users’ interests in the decision-making processes of their governing bodies.

We are requiring the interbank operators to comply with our direction from 30 September 2015 and to provide an annual compliance report, with the first due by 31 October 2015.

Conflicts of interest

Conflicts of interest can have an adverse effect on competition and, in turn, on innovation and the interests of service-users.

The industry structure for interbank payment systems in the UK is characterised by vertical relationships involving the presence of the same participants at different levels in the supply chain – such as at operator level, infrastructure level and PSP level. A number of PSPs also appoint directors to several if not all of the different interbank systems operators.

We are going to require interbank operators (except BBCCL) to ensure from 30 April 2015 that any director of that operator must not simultaneously be a director of an actual or potential central infrastructure provider to that same payment system.

We also expect interbank operators to review their conflicts of interest policies and mechanisms in light of the concerns we express. We want interbank operators to consider whether aspects of their conflict of interest policies and mechanisms are sufficiently robust or could be managed better or more transparently.


Where there is a lack of transparency in decision-making at board level of operators it could mean the interests of service-users are not taken into account - or not perceived to be taken into account.  It can also mean that the implications for service-users are neither fully understood nor sufficiently factored into decision-making.

Consequently we are going to require the boards of interbank operators (except BBCCL) to publish board minutes, including votes, in a timely manner, from 30 April 2015.

We expect this increased transparency about decision-making will enable service-users to satisfy themselves that interbank operators are appropriately considering their interests when taking decisions, and will make operators’ directors more accountable for their decisions.

This should help indirect PSPs and other service-users understand the reasons why decisions which affect them have been taken and that those decisions are not simply in the interests of large member banks. This should increase confidence in the governance and decision-making processes of the interbank operators.

General directions given by the Payment Systems Regulator