Out-Law News 1 min. read

Payment systems regulator wants greater use and availability of payments data


The Payment Systems Regulator is to look in more detail at the use of payments data by the businesses that operate the major payment systems in the UK.

In a speech earlier this week, Hannah Nixon, managing director of the PSR, said the use of data is one area that the regulator wants to gain a better understanding of so as to determine "what, if any, role we should play".

Nixon said the PSR is "seeking much greater availability and use of payments data (including cards data)" and plans to look into the implications that could have on the users of payment systems.

"While [greater availability and use of payments data] could drive innovation in the sector, resulting in more payment products and services being made available to end-users, the increased commercial use of payments data could have implications for end-users with respect to privacy, security and data protection," Nixon said. "We want to explore those issues and consider what our role should be."

Nixon said that another area that the PSR is keen to gain a better understanding of is how technology is shaping competition in the payments sector.

"New technology and new participants in the payments space is inevitably changing the competitive dynamics of the sector," she said. "We want to explore those issues and understand the implications for market structure and competition."

Nixon said that the PSR also expects to have to consider more issues relating to consumer protection in future as the use of new technologies present new opportunities to fraudsters.

"Our challenge as a regulator will be to stay ahead of the curve to foresee challenges and to fill any regulatory gaps as quickly as possible; and regularly re-evaluating the existing regulatory framework," Nixon said. "We will continue to create an enabling environment that fosters competition and innovation and puts users at its heart."

Late last year, the PSR gave its backing to a new strategy that would see existing UK payments infrastructure replaced with "new payments architecture" that uses modern technology. New payments infrastructure could be based on distributed ledger technology, or 'blockchain', although other options are being explored. A "proving pilot" is to be established by the end of 2017.

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