What Is the Payment Systems Regulator?
The PSR is a UK regulator established in 2015 to regulate payment systems. The regulator ensures that businesses and consumers enjoy the benefits of solid payment systems, which function with fair competition and innovation.
The PSR was set up as a consequence of the reviews from the Cruickshank Report in 2000 and the HM Treasury consultation Opening UP UK Payments. Consequently, the PSR was created under the Financial Services (Banking Reform) Act 2013. In 2014 they started work by taking a closer look at various payment systems used in the UK. However, the PSR became fully operational on April 1st of, 2015.
The headquarters of the PSR is in Stratford, London, and the HM Treasury has designated the eight payment systems they monitor. They have powers from the Government of the UK, which means they are one of the more essential regulators in the country.
What Is the PSR Responsible for?
Now we will delve deeper into the responsibilities of the PSR. This will help you better understand how they help money transfer customers interact with the UK’s economy and why they are a noteworthy regulator.
The responsibilities of the PSR include:
Shared interests: the PSR contributes to the development of the UK’s payment system in a way that considers the interests of regular consumers and businesses alike. They use developing technologies to ensure the UK has more payment systems. This includes cashless payment systems that have gained much traction over the last decade.
Competition: the PST ensures that the competition is fair and flourishing in the payment systems and services industry. This includes the infrastructure providers, PSPs and operators.
Development: the regulator ensures that the payment systems used in the UK are constantly developed to improve the financial infrastructure. Therefore, the innovation leads to better results for the UK’s economy.
Collaboration: the PSR talks to the payment system providers, infrastructure providers, payment system operators and businesses that use these systems. They do this to get the latest information and insight to complete their job.
The Payment Systems Regulator is funded by the industry and is an independent organisation with its managing director and board. Also, they are accountable to the Parliament and are an independent subsidiary of the Financial Conduct Authority.
What Is the Importance of the Payments Services Regulator?
This section looks at the importance of the Payments Systems Regulator's work for the UK economy. This allows consumers of money transfer services to trust the systems used to send money.
Contributes to financial infrastructure: payment systems are how different financial entities interact in an economy. The PSR is a pivotal contributor to the proper functioning of these systems, so they lay the groundwork for vital financial infrastructure.
Promote trust in payment systems: consumers of money transfer companies like Xe and Wise can have more confidence that the payment systems work as intended. Therefore, you can send large amounts of money with peace of mind that the recipient will get the funds.
Hold financial entities accountable: when payment systems are not working correctly or using unfair practices, the PSR steps in to regulate the industry. In addition, they hold the services that offer payment systems to the general public accountable.
Improve trust in the economy: the Payment Systems Regulator improves the trust factor in the British economy. They do this by ensuring that the payment systems run smoothly around the clock. Therefore, people are more willing to spend and invest.
Development: this regulator constantly pushes innovation, which keeps the payment systems relevant and protected. The best security methods and money transfer conditions are created for regular consumers.
The PSR regulatory enforces their policies, some of which are based on the Competition Act 1998 (CA98). So they investigated NatWest Groups banks’ to ensure they comply with the Interchange Fee Regulation. They discovered that non-compliance was evident in 4 banks, and they were fined a total of 1.82 million GBP.
Payment Systems Regulator Regulations
Now let us dive deeper into the regulations, crimes and industries relevant to the PSR. This section provides vital information at a glance that allows you to figure out how the regulator helps customers of money transfer companies.
Regulations: the PSR has strong regulatory and competition powers, which means they can give direction and set standards, impose requirements about system rules, ask operators for direct access to payment systems, amend payment system fees or charges, investigate questionable behaviour and act when there is evidence of anti-competitive signals.
Overall, the PSR is the most significant authority in the payment systems industry, with powers handed down from the government. Therefore, all businesses that operate in the payment system space are accountable to the PSR.
Crimes: the crimes that the PSR deals with relating to the payment systems and how they are implemented by banks or money transfer companies like Currencies Direct. They monitor the industry and look for breaches, which can result in fines.
Accountability: they are accountable to the British government, with strong powers to ensure they can enforce the laws.
What Regions Does the PSR Cover?
The PSR is only responsible for the payment systems in the UK financial markets. They deal with the banks and money transfer companies that operate in the UK, but those entities typically also offer services abroad.
When Might You Encounter the Payment Systems Regulator?
The regulator does not have a role in dealing with the general public, so you are unlikely to encounter them directly. However, you may receive news from the organisation about updates to the payment systems in the UK.
However, money transfer customers will have encounters with the systems that the PSR is responsible for regulating. For example, if you use online means to pay for goods, you would have used systems that the PSR regulates.
Can the PSR Make New Rules?
The PSR has strong powers to create and enforce new rules on all aspects of the payments systems in the UK. The rules might relate to the cost of money transfers and the speed of sending money.
The regulator constantly updates the rules of the UK’s payment systems to meet the challenges of continually developing technologies. Also, they ensure that the payment systems industry is fair for every business.
How to Contact the Payment Systems Regulator?
In this section, you will learn the contact details that the general public can use. You may wish to learn more about how the regulator enforces their policies for the payment systems you use.
Phone: 020 7066 1000
To conclude, PSR is a regulator that oversees a specific aspect of the UK economy – its payment systems. They contribute to the proper and smooth functioning of payment systems companies and banks provide. Also, they contribute to the constant development of payment systems by pushing innovation.
We encourage you to learn more about the money transfer industry in the UK by reading our other guides. You can start with Send Money To the UK and Send Money to the USA from the United Kingdom. Digesting these guides will help you find money transfer companies that offer the lowest fees and most competitive currency conversion rates.