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UK Cards response to PSR

The UK Cards Association is supportive of the new Payment Systems Regulator (PSR) and the positive role that it can play in helping the UK industry to maintain its leading position in payments globally. We believe the PSR can provide a focused and impartial view on how the payment system network should operate across the UK.

In our response we outline some key principles for the PSR to consider as it launches in April 2015:

Proportionate and avoiding unintended consequences

Various changing layers of regulation apply to different parts of firms’ activities, adding to cost. The PSR should carefully consider imposition of further regulatory costs, which could restrict the ability of the UK industry to invest in its competitive features and future infrastructure.

Impartial and evidence-based

The PSR can help payment providers, retailers, consumers and other stakeholders by providing a balanced and impartial view on what is appropriate for the UK industry. Future regulatory requirements should be subject to proper impact assessment where the benefits for certain customers are clearly evidenced and balanced against the costs of delivery; especially as these costs will ultimately be borne by end users.

Supporting practical, industry-led innovation

While it is important to encourage a range of innovative products fitting customers’ needs, the pace of change in payments so far has reflected the need for resilience, security and consumer trust. The PSR could help set high level principles for innovation and review progress against them, but ultimately the industry needs to lead development and implementation of innovative products.

Regulatory delineation

Within the complex UK/EU regulatory framework the PSR can help make sense of regulation for firms, especially smaller firms, and can help inform and shape relevant regulation to the benefit of the UK industry and consumers. There needs to be a clear understanding of how the PSR fits with other financial regulators; and delineation between the PSR as an economic regulator and the FCA as a conduct regulator.

Assisting collaboration with other industries

A world class payments system needs to be developed in coordination with strategy for relevant industries such as retailer, telecoms, transport, and fintech. The PSR can add huge value through acting as a ‘broker’ with firms, regulators and associations from these industries, which are increasingly central to future developments.

To read the full consultation response, click on the link below.

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