IBS Journal January 2017
15
“PEOPLE THOUGHT THAT THE INDUSTRY WOULDN’T MAKE ANY REAL CHANGES. WE’VE ALL SEEN TIMES WHEN SELF-REGULATION HAS TURNED INTO NO REGULATION”
the market for competition and to deliver real benefits to the consumer. However, we must recognise that it is still a long way from being implemented. There is still a lot to do to make sure this turns into a reality and has a positive impact for the end users.”
Despite all the optimism there are still a number of worries coming from the community, acknowledged the PSR MD. One of the biggest is that there are too many on-going regulatory initiatives in an industry that is already having to deal with the consequences of Brexit. Nixon believes that challenges can be overcome, though, as the Forum “creates an opportunity for payment service providers to create synergies between these different initiatives. Continued engagement with the Forum will allow them to ensure investment is sequenced in a sensible and strategic way.” The level of encouragement from the highest levels of the industry is a bonus. “Whenever I meet with CEOs they want to reaffirm their support for the Forum and the strategy.”
The strategy published by the Forum is only one part of what will be a massive shake-up of the UK’s payments industry, and will sit alongside the work the PSR is doing to promote wider innovation. Changes that have already been pushed through are helping to make the payments landscape more competitive and innovative, and the new strategy will play a key part in how the needs of users are met in the present and the future.
Andrew Hauser, Executive Director for Banking, Payments and Financial Resilience at the Bank of England, rose to tell attendees that the new strategy isn’t one developed
by the Bank of England. This is an inherently good thing, he admitted, over chuckles from the floor. The strategy has been drafted by providers and users with themselves in mind. Not that the Bank of England has been lukewarm on the project. “We’re open, not closed, to innovation,” he noted. “Though we must have a relentless focus on stability.” Households and companies expect stability and safety – more so the case in fluctuating markets – and no amount of shiny API-enabled transactions can make up for a misplacement of money or waylaid funds.
There are three important considerations that need to be made, said Hauser: a consolidation of cheques and a reduction of risk; moving banks onto a common platform and developing a new payments platform with a workable design. In the future, there may be an infrastructure for both the retail and wholesale sectors, but it needs to be secure and in line with Bank of England systems.
Director of Strategy and Competition at the Financial Conduct Authority, Christopher Woolard, echoed Hauser’s sentiments. “When systems are introduced we face new challenges,” he said. “There can be unforeseen developments and new types of exploitations for every new innovation.” Delivering a new payments system won’t happen overnight, but there are a series of quick wins and technology jumps that can help move things forward in the interim.
It’s important to make sure that the UK’s infrastructure is ready for wide-scale change. “A bullet train can’t run at full speed on 19th century rails.”
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