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With its harebrained proposal to discontinue cheques from 2018, the UK Payments Council has brought this upon the industry and has driven the government into not seeing "a formal role for the Payments Council in the new regulatory structure". This should
also expose that academicians and digerati spouting the "cash should be banned" and the "cheque should be killed" mumbo-jumbo are totally removed from the needs, wants and preferences of the average "man on the street".
I too had a good look over the paper. I feel sorry for you.
I agree there's a definite "political" slant to it. Especially with references to "the last government" and "the then-government".
If this is all triggered by the fact that the Payments Council got it wrong in trying to phase out cheques - so they should go. I wonder what that says about the government itself and all its political u-turns? Perhaps they should go as well?
All of that said, the creation of a new "regulatory body" shows political interference. Will this new body really be independent? The Financial Services Industry is one of the most powerful and important sectors in the UK. Also it has quite a few "high earners"
who might want to fund the various political parties to "pull a few strings" behind the scenes.
Also you point about Luxembourg is valid. I know that PayPal already has a banking license - issued in Luxembourg.
Just like fraud finding security "loopholes", if there's a reason to sidestep or avoid regulation, given sufficient financial incentive - I'm sure there's a way of doing so. Be that moving operations to Luxembourg or making them virtual "in the cloud".
I think that trying to strong-arm the industry into following licensing terms and bureaucratic regulations will not encourage innovation. Quite the opposite.
I only see the likes of Metro Bank potentially benefiting from something like this.
It will be interesting to see where the debate takes us, but as you said "Industry consultation came out clearly in favour of the Payments Strategy Board so equally clearly the government has decided to do something entirely different".
So no matter what is commented back on this "consultation" - will it really make any difference or just be ignored in favour of a decision that's already been made from an ivory tower?
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27 Mar 2013