The Payment System Regulator (PSR) has recruited three executives in the run-up to its operational launch in April 2015.
The regulator intends to boost competition in the £75tn UK payments sector.
The PSR will oversee the sector and encourage new players to innovate to create value for consumers. The largest payment systems are owned and managed by the big banks and there are concerns the sector lacks transparency and innovation.
The managing director of the PSR Hannah Nixon said in November 2014 that the systems used today were developed incrementally over time by the major banks. “While they are relatively resilient, they are often treated as back-office functions. Competition is limited, decision-making opaque and this is stifling innovation.
"This has to change.”
The PSR has appointed Carole Begent, previously senior legal director at the Competition and Markets Authority (CMA), as head of legal; Mark Falcon, from Hutchison 3G UK (Three), as head of regulatory policy and strategy; and Louise Buckley leaves Stracey Wheeler Consulting to become the PSR’s head of stakeholder engagement and communications.
Read more about the Payments Service Regulator
Lack of transparency
About 21 billion UK financial transactions were made possible by payment systems in 2013. Because the large payment systems – which ensure people can withdraw money from cash machines, pay bills and be paid wages – are owned by banks, the FCA is concerned the sector lacks transparency.
Ovum analyst Kieran Hines told Computer Weekly that opening up membership of services such as Faster Payments to more providers will drive innovation and level the playing field. “Many of the smaller banks can only access this via sponsor banks, which can make it expensive to offer these services to customers.
"However, there is also the risk this reduces the willingness of banks to invest in this kind of infrastructure in the future."