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Hannah Nixon's speech at the Payments Strategy Forum's Final Strategy launch event

Published 29 11 2016

Speech by Hannah Nixon, Managing Director of the PSR, at the launch of the Payments Strategy Forum’s Final strategy on 29 November 2016 in London. 

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


Thank you.

It's a pleasure to be here with you as the Forum launches its Final strategy.

I’m really proud of the work the Forum has done over the last year and the proposals it is releasing today. The Forum’s Final strategy represents a real step forward in that it provides the basis for a fundamental shift in the way payment systems work, something which has the ability to drive real benefits to all who use payment systems – consumers and businesses alike.

Of course the strategy now needs to be implemented but this is a great step in the right direction and shows the industry working together at its best. 

The PSR will continue to support the Forum as these initiatives are implemented.

I want to talk today about the PSR’s relationship with the Forum: why we set it up, how we see the strategy it is launching today, and what’s next. It’s not quite a Christmas carol, but I hope that understanding the past, present and yet to come will help you understand what the PSR and the Forum are doing to strengthen the UK payments sector.

Past: The Beginnings of the Forum

The PSR founded the Forum a year ago in order to speed up the pace of collaborative innovation in payments. Despite the fact that the PSR has possibly the most extensive powers of any economic regulator in Britain, we decided not to enforce a solution on the industry without their involvement. We decided that this was an area where it would be better to harness the resource and expertise of industry in the widest sense – from end users to big banks.

The PSR is a new kind of regulator, and a first of its kind model for careful, considered regulation of payment systems that other countries can follow. We aim to regulate strongly and effectively where necessary, but also to create the conditions to allow competition and innovation to thrive. Setting up the Forum was one of the conscious decisions we took to empower the sector we regulate and to find the right solutions.

At that time there were a lot of people who were sceptical about whether a Forum like this could work. People thought that the industry wouldn’t make any real changes. We’ve all seen times when self-regulation has turned into no regulation, and many people thought that would happen this time as well and that the Forum would be no more than a talking shop. It’s clear today that the Forum has exceeded all expectations.

There are two reasons why the Forum is successful:

  • The first is the collaboration between everyone involved in the UK payments sector. Through hard work and effort, stakeholders from across the industry and from consumer groups came together to form the Payments Community. The whole community has been integral in shaping this strategy and the breadth and the energy of its membership has been one of the Forum’s great strengths.
  • The second is that the PSR has supported the Forum from the start. This has been a coordinated effort between the regulator and the whole of the sector.

Present: What the Forum has achieved

The result of that success is the strategy that is being launched today. We are delighted to see that it places service users at the heart of what it does.

This is a strategy that has been developed by people working at the coal face, on both the industry and consumer sides. That makes it more effective and more enforceable than a solution designed by a regulator working alone.

We are all grateful to the Forum’s chair, Ruth, the Forum members who have worked so hard on the various working groups that put this strategy together, and to the whole Payments Community for their constant, enthusiastic input, which has shaped and guided the final strategy.

Future: What happens now?

So what happens next? Now that the strategy has been published we have to implement it.

This strategy is game changing. It has the potential to really open up the market for competition and to deliver real benefits to the consumer. However we must recognise that it is still a long way from being implemented. There is still a lot to do to make sure this turns into a reality and has a positive impact for the end users.

Once again we’re hearing doubts about the approach.

Some people think that the industry isn’t capable of carrying out the changes required. I disagree. Simply getting to today surpassed expectations and I see no reason to stop now.

One of the biggest concerns is that this is one of many on-going regulatory initiatives in an industry that is already dealing with the challenging, post-Brexit, low interest rate climate.

We recognise that there are a number of demands on the industry at the moment. However I believe the Forum can once again meet this challenge. The Forum approach creates an opportunity for payment service providers to create synergies between these different initiatives. Continued engagement with the Forum will allow them to ensure investment is sequenced in a sensible and strategic way.

I am also encouraged by the optimism and support for the strategy that I hear regularly from the very highest levels of the industry. Whenever I meet with CEOs they want to reaffirm their support for the Forum and the strategy.

This sets us up well to do the hard work of implementation.

We recognise that the Forum has proposed an ambitious timetable but we applaud that ambition, and we are confident it will be achieved.

We will continue to stand behind the Forum as it progresses its work.

We’re not going to intervene for the sake of it. But where intervention is needed to make things happen we will step in.

Why it matters

This collaboration is reshaping the UK payments sector, making it work for service users and driving innovation.

The Forum is only one part of a massive shake up of the UK payments industry. The strategy published today sits alongside the work the PSR is doing to promote wider innovation, protect people from fraud, increase access to payment systems and restructure the industry.

The changes we have implemented so far are already helping to make the payments system more competitive and innovative, and to support consumers and businesses. This strategy is part of the on-going progress we are making to transform the UK payments sector into one of the most advanced and resilient in the world.

The PSR is already incorporating the strategy into our wider work by responding to the Forum’s suggestion to consolidate the three payment system operators. The Forum has proposed that consolidating Bacs, the Cheque and Credit Clearing Company and the Faster Payments Scheme would reduce the complexity and cost of having multiple payment systems. The Forum asked the PSR and the Bank of England to work together to determine the best way to implement this change. In response we established and appointed a Payment System Operator Delivery Group to examine the options. The Group is due to report back in March next year and we look forward to learning what it will recommend.

The strategy published today is a key part of how the PSR and the Forum are working to meet the needs of users now and in the future. As a result of all our efforts, the way payment systems work and treat their users is changing.

The PSR, and everyone else here, is now looking forward to seeing it implemented.

Thank you and I hope you have an enjoyable day.