UK payments industry prepares for new watchdog
16 June 2014 | 10442 views | 0
The UK will get a new payments regulator next year, while the industry is busy working on its own 'roadmap'. Finextra spoke to key players from both sides about how they will work with each other.
In April 2015 a new utilities-style payments regulator will launch, ending the self-regulatory approach that banks currently enjoy through the Payments Council.
There has been some debate over how the Payments Systems Regulator (PSR) and the Payments Council will work together, particularly as the latter has been busy setting out its own vision for the future through its Payments Roadmap.
Speaking at a recent Payments Council event, Mary Starks, the PSR's acting managing director, told Finextra that the new watchdog is still working through what its role will be in supporting innovation but that regulation is distinct from the "engineering".
However, she warns that while regulators generally stick to providing a framework and then letting competition drive innovation, the PSA could take a more hands-on approach.
"I think there's a question in payments of whether that [setting a framework] is enough or whether the regulator will need to go further and be a bit more directive," says Starks.
Payments Council CEO Adrian Kamellard insists that the organisation still has a vital role to play. "Regulators are not there to develop strategy for the industry," says Kamellard.
That this is where the Council and its roadmap come in, answering big strategic questions on issues such as moving to international standards and making further inroads on real-time payments.
"Then the regulator can look at both the questions and the way that they are being answered and say, either that's fine, in which case they'll focus on other areas. And if it's not fine they'll make it clear that it's not fine and we'll then address any concerns they may have," says Kamellard.
From the banks' perspective, RBS's Simon Newstead says that there is no real distinction between how the new regulator and the roadmap are approached. "It's hugely important...that we end up with a single roadmap" for the next two to five years.
Newstead says that there are a huge array of projects that the payments industry could embark on and so a key role for the PSA will be to establish what the priorities are, what to do and in what order.