Faster Payments

Plan Takes Shape For UK Payments Framework

The United Kingdom’s Payments Systems Regulator (PSR), along with the Bank of England, said Thursday that they’d agreed to a framework that would govern consolidation of the Cheque and Credit Clearing Company and the Faster Payments Scheme and Bacs.

Reuters stated that the U.K.’s “multi-trillion pound system for shuffling payments” and checks will get a makeover, with an eye on letting new entrants into the market. This retooling of the market would help break the dominance of the four biggest banks, which include RBS, Barclays, HSBC and Lloyds.

At the moment, upstarts have to use existing rails, for which they are charged a fee. The entities mentioned above that are forming the new group, as they are being consolidated, would now be accessed by a single application by a banking newcomer, which would streamline process and costs.

In a statement, PSR Managing Director Hannah Nixon said that “the consolidation would be an important first step toward a generational change in U.K. payments,” adding that “consumers will also benefit from new entrants coming into the market and offering users of payment services new, innovative products.”

The recommendation has almost the form of dictate, as the PSR can force through changes, said Reuters.

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