The second phase of a new access model for non-bank payment service providers (PSPs) has recently gone live. The new model allows non-bank PSPs to utilise client funds to support payments made via the Faster Payments system. Bacs is due to go live with this model later this year. The first phase previously went live in March 2018 and allowed non-bank PSPs to settle payments utilising their own funds.
Delivery of this project further opens up access to the UK payments market. It is a change that benefits non-bank PSPs, such as authorised payment and e-money institutions, which may not otherwise have been able to meet the capital obligations required to join the payments schemes. It enables them to gain direct access to a payments scheme without relying on a third party (usually a competitor) either to submit payments or settle payments on their behalf.
Pay.UK has worked with the Bank of England, the Financial Conduct Authority and HM Treasury to develop and implement the contractual and legislative changes that have enabled this positive development to be brought to reality. As well as ensuring that payments remain secure and dependable, these changes will maintain protection of the funds used to make payments, whilst minimising systemic risk for the UK’s financial system and its participants.
The implementation of innovative concepts such as this access model for non-bank payment service providers is at the very heart of what Pay.UK is all about. We are committed to enabling the move towards a more open and efficient payments market that will benefit everyone, as well as supporting innovation whilst ensuring payments remain secure and dependable.
Said Paul Horlock, CEO of Pay.UK.