FCA speaks on payment supervision consolidation

David Geale, PSR managing director and FCA director for payment and digital finance, spoke on the impact of consolidating the PSR into the FCA, and how this can help a more joined-up approach. Firms will no longer have to navigate separate regulators, and there will be a consolidated approach looking to simplify regulation where it can. As with other areas, the regulator will be looking at striking the balance between innovation and preventing harm. He cited recent work on rebalancing mortgage regulation to allow more consumers to borrow while protecting them with the Consumer Duty’s obligations on firms. He then spoke to the removal of the contactless limit, which he said the regulator had been told lacked flexibility. He repeated that the worry that removal of the limit could bring higher rates of fraud must be tempered by the reality that the change is only open to firms with strong fraud controls. That said, the regulators are encouraging providers that don’t currently offer their customers the choice of what limits to set (or, now, not to have one) to do so.

For the future, he moved onto Open Banking, and the upcoming roadmap for Open Finance, moving the principles of Open Banking to other areas of the financial markets.

Finally, he looked at evolving regulation, and the evolution of crypto regulation, with the FCA planning final rules in the summer before the gateway opens later in the year.