Government must be clear on the role of the FCA as payment systems regulations consultation closes

Willem Wellinghoff, Chief Compliance Officer and UK Chair of inclusive payments platform, Ecommpay sets out expectations as government closes consultation on payment systems regulation

“Ecommpay feels immensely positive that the UK government is committed to streamlining regulation for the payments ecosystem and we support the National Payments Vision. However, with the consultation on payment systems regulation closing last month, we are concerned that there will be an over-simplification of the task.

“The industry does certainly recognise the challenge the FCA and the PSR have to remain focused on their foundational duties, alongside fostering growth and innovation. Whilst we see significantly more positive collaboration with industry, critically it is vital that there is no misunderstanding that the duties of the PSR and FCA must be carefully aligned and adapted to ensure they meet industry and societal needs. All the signals currently are that the FCA will become a super-regulator covering all areas.

“The fact of the matter is that the FCA and PSR focus on different things. One is a conduct regulator securing protection for consumers and ensuring market integrity. The other is a payment systems regulator focusing on ensuring the systems work effectively and drive innovation. Merging the two functions could result in neither task being properly delivered, particularly as the recent FCA & Practitioner Panel Survey showed some key areas for improvement. Naturally, we all hope that the right balance and approach can be achieved, but a short-term quick-fix solution is not advisable. A more gradual, proportionate approach is needed.

“As the Payments Association has recently identified, the plans for a post-PSR landscape "risk jeopardising UK payments reform". It is essential, therefore, that clear delineation of the roles of the FCA and the Bank of England are established for proper regulatory oversight.”