G A U G I N G T H E M A R K E T
G A U G I N G T H E M A R K E T
THE END OF THE PSR: A STEP TOWARDS SMARTER REGULATION IN THE UK
Dima Kats, CEO and Founder of Clear Junction
Dima Kats, CEO and Founder of Clear Junction, explores why the UK’ s decision to scrap the Payment Systems Regulator marks a pivotal shift towards smarter, more streamlined oversight – and what payments businesses must watch for during the transition. he UK government’ s decision to scrap the Payment Systems Regulator( PSR) isn’ t just about cutting red tape. It’ s a
T shake-up of how payments oversight works. Payments businesses have long argued that compliance had become overly complex, with firms needing to engage with three regulators: the Financial Conduct Authority( FCA), the PSR and the Bank of England. The result was regulatory congestion that slowed decision-making and left businesses unclear on which authority they needed to engage with.
Why the PSR fell out of step
The PSR was originally set up to promote competition and transparency in payment systems, but in practice, its role often overlapped with the FCA’ s. This was particularly evident in areas like fraud policy and Open Banking, where coordination between regulators was inconsistent. We were especially concerned when the PSR overlooked key industry feedback on fraud, resulting in avoidable gaps in protection.
Businesses reported that engaging with multiple regulators on the same issue was time-consuming and costly, with conflicting guidance in some cases. For example, Open Banking, intended to increase competition and innovation, has been hindered by regulatory uncertainty. Firms have struggled to engage effectively with the Joint Regulatory Oversight Committee( JROC), a body that includes both the FCA and PSR. This lack of clarity has slowed down progress on initiatives like account-to-account( A2A) payments and fraud prevention, adding to the argument that a single regulatory body should take charge. www. intelligentfin. tech
17