Payment Systems Regulator

Overview

The Payment Systems Regulator (PSR) is the United Kingdom's independent, specialized regulator of designated payment systems, established on 1 April 2015 under the Financial Services (Banking Reform) Act 2013. Operating as a statutory operational subsidiary of the Financial Conduct Authority (FCA), the PSR is the sole UK regulator focused exclusively on payment systems, with binding authority over seven designated payment systems that are fundamental to the UK's payments infrastructure.

The PSR is critical for UK payments, regulating:

• Access to Payment Systems — non-discriminatory participation criteria for banks and payment providers
• Interchange Fees — wholesale fee regulation for Visa and Mastercard payment systems
• APP Fraud Reimbursement — mandatory consumer reimbursement for Authorized Push Payment (APP) fraud victims
• System Stability — operational resilience and risk management for core payment infrastructure
• Competition & Innovation — promoting competition in payment system markets and supporting payment innovation

The seven designated payment systems regulated by the PSR are:

1. Bacs — domestic bank-to-bank transfers
2. CHAPS — high-value payment clearing
3. Faster Payments / NPA — instant payments and new payment infrastructure
4. LINK — ATM network and cash access
5. Mastercard — international card payments
6. Visa — international card payments
7. Cheque Clearing System — paper cheque processing

Basic Identity

Classification

Inclusion Justification

What This Entity Oversees

Regulatory Authority & Scope

Payment Systems Regulation Perimeter

The PSR's regulatory scope is defined by designation of payment systems as subject to PSR regulation. The PSR Rulebook and official register identify all designated systems and applicable regulatory requirements.

Designated Payment Systems (Current):

Regulatory Perimeter Definition

The PSR regulates:

1. System Operators — Organizations operating designated payment systems

• Bacs Payment Schemes Limited (Bacs operator)
• Pay.UK (CHAPS and Faster Payments/NPA operator)
• Link Group (ATM network operator)
• Visa Europe and Mastercard Europe (for card systems)
• Voca (cheque clearing operator)

2. System Participants — Firms using designated systems to deliver payment services

• Commercial banks
• Building societies
• Payment institutions
• E-money institutions
• Credit institutions
• Non-bank payment service providers

3. System Infrastructure — Technical, operational, and governance aspects

• System access and participation criteria
• Fee structures and pricing
• Operational resilience and business continuity
• Risk management and control frameworks
• Innovation and modernization initiatives

Key Regulatory Functions

The PSR exercises five core regulatory functions over designated payment systems:

1. Access Regulation

• Setting non-discriminatory access criteria for payment system participation
• Requiring system operators to maintain fair, transparent participation procedures
• Resolving formal access disputes where firms are denied access
• Promoting access for new payment providers and innovators
• Monitoring access barriers and competitive issues

2. Interchange Fee Regulation

• Setting maximum interchange fees for Visa and Mastercard systems
• Conducting regular fee reviews and adjustments
• Promoting transparency in fee structures
• Preventing anti-competitive fee arrangements
• Balancing merchant, issuer, and consumer interests

3. Consumer Protection (System-Level)

• APP fraud reimbursement framework (Bacs, Faster Payments, CHAPS)
• Confirmation of Payee (CoP) fraud prevention requirements
• Protecting consumers from unfair access restrictions
• Ensuring fair fee structures that do not harm consumers
• Monitoring payment system stability affecting consumer access

4. Operational Resilience & Stability

• Requiring business continuity and disaster recovery capabilities
• Stress testing and capacity planning
• Cyber security and operational risk management
• Liquidity and credit risk controls
• Monitoring payment system concentration risks

5. Competition & Innovation Promotion

• Removing access barriers to support new entrants and innovators
• Monitoring competitive dynamics in payment system markets
• Supporting modernization (e.g., New Payments Architecture / instant payments)
• Coordinating with Competition and Markets Authority (CMA) on competition matters
• Promoting interoperability and technical standards enabling innovation

APP Fraud Reimbursement Framework

Consumer Reimbursement Mandate

In response to rising Authorized Push Payment (APP) fraud losses (£500+ million annually in UK), the PSR established mandatory consumer reimbursement requirements for participating institutions in Bacs, Faster Payments, and CHAPS systems.

Reimbursement Requirements

Eligibility:

• All APP fraud victims are eligible for reimbursement unless they are grossly negligent
• Gross negligence is narrowly defined; ordinary negligence (e.g., ignoring fraud warnings) is NOT a bar to reimbursement
• Reimbursement applies to debit cards, bank transfers (Bacs, Faster Payments), CHAPS, and standing orders

Reimbursement Process:

1. Fraud victim reports fraud to their bank within reasonable time
2. Bank investigates and determines fraud claim legitimacy
3. If fraud confirmed and victim not grossly negligent, bank reimburses within 15 calendar days
4. Disputed reimbursement claims escalated to Financial Ombudsman Service (FOS)

Reimbursement Amount:

• Full loss amount (principal + interest, where applicable)
• No caps on reimbursement amounts
• No excess or co-payments required

Confirmation of Payee (CoP)

To prevent APP fraud before it occurs, the PSR mandates Confirmation of Payee (CoP) checks:

• When sending a payment, the payment recipient's name is checked against the account holder's name
• System provides match confirmation (match, close match, no match, unavailable)
• If "no match," payment is declined or additional verification is required
• Reduces APP fraud by allowing consumers to verify they are sending to the correct recipient

Implementation:

• Mandatory for all banks and payment institutions in Bacs, Faster Payments, and CHAPS
• Progressively expanding to all payments (currently covers most volumes)
• Expected to significantly reduce APP fraud losses as adoption increases

Interchange Fee Regulation

Visa & Mastercard Interchange Caps

For card payment systems (Visa and Mastercard), the PSR has set maximum interchange fees to promote competition and protect consumers:

Current Interchange Fee Caps (UK):

These are among the lowest interchange fee caps globally, reflecting UK competition policy favoring low merchant costs.

Fee Review Process

The PSR conducts regular interchange fee reviews:

1. Assesses competitive conditions in UK card market
2. Reviews international interchange fee benchmarks
3. Evaluates consumer and merchant impact
4. Adjusts caps if needed to promote competition
5. Publishes consultation and final decisions

Fee Transparency Requirements

System operators must:

• Publish interchange fee structures clearly and publicly
• Explain fee rationale and cost allocation
• Disclose any subsidies or cross-subsidization between card types
• Update fees in accordance with PSR-approved schedules

Conclusion

The Payment Systems Regulator (PSR) is the United Kingdom's specialized, critical regulator for designated payment systems. With binding authority over seven core payment systems (Bacs, CHAPS, Faster Payments/NPA, LINK, Mastercard, Visa, cheque clearing), the PSR safeguards payment system competition, access, stability, and consumer protection.

As the sole regulator focused exclusively on payment systems, the PSR fills a critical regulatory gap, ensuring that the UK's essential payment infrastructure remains resilient, competitive, and fair. Through access regulation, interchange fee controls, APP fraud reimbursement requirements, and operational standards, the PSR shapes how UK payments work every day for consumers, businesses, and financial institutions.

For researchers, payment professionals, and policymakers, understanding the PSR's role and authority is essential to comprehending UK payments regulation, competition policy, and financial stability frameworks.

End of Document

This page provides a comprehensive record of the Payment Systems Regulator (PSR) as the United Kingdom's sole designated payment system regulator. It is intended for research, regulatory compliance, and payments industry reference purposes. For current regulatory information, consult the PSR official website at https://www.psr.org.uk.

Regulatory Powers

Binding Regulatory Authority

The PSR has binding regulatory authority over designated payment systems and their operators. This means:

• PSR rules and requirements are mandatory for system operators and participants
• PSR can issue binding directions requiring specific actions
• System operators cannot override PSR requirements
• Participants must comply with PSR-mandated access criteria and operational standards

Key Powers

1. Designation Authority

• Power to designate payment systems as subject to PSR regulation
• Current seven systems are designated; power to designate new systems if they meet systemic importance criteria

2. Rule-Making Authority

• Authority to establish binding rules and guidance for designated systems
• Rules codified in PSR Rulebook, published at https://www.psr.org.uk/publications/rules/rulebook
• Binding on all system operators and participants

3. Access Decision Authority

• Power to resolve formal access disputes
• Authority to require system operators to grant access where denial is unjustified or anti-competitive
• Binding access decisions enforceable against system operators

4. Fee Regulation Authority

• For card systems (Visa, Mastercard): power to set maximum interchange fees
• Authority to require fee transparency and cost-based pricing
• Regular fee review and adjustment authority

5. Investigative Powers

• Authority to investigate payment system operators and participants for non-compliance
• Power to require information, documents, and records
• Authority to conduct on-site inspections

6. Enforcement & Sanctions

The PSR can impose enforcement action against designated payment system operators for breach of PSR rules:

Financial Penalties:

• PSR can impose financial penalties on payment system operators
• Penalty amounts scaled to breach severity and system operator size
• Recent enforcement actions have resulted in penalties ranging from hundreds of thousands to millions of pounds

Binding Directions:

• PSR can issue binding directions requiring system operators to:
• Cease prohibited conduct
• Implement specific control improvements
• Change operational procedures
• Modify governance structures
• Establish new processes (e.g., fraud prevention, compliance monitoring)

Suspension or Withdrawal of System Designation:

• In extreme cases, PSR can suspend or withdraw system designation
• This is reserved for severe, persistent breaches threatening system stability or consumer protection

Enforceable Undertakings:

• PSR can accept binding commitments from system operators to remediate breaches

Criminal Referral:

• PSR can refer criminal offenses to law enforcement for prosecution (e.g., false information submissions, obstruction)

Recent Enforcement Activity

The PSR has issued binding directions and enforcement actions addressing:

• Access barriers and anti-competitive conduct (Visa, Mastercard, CHAPS)
• APP fraud reimbursement failures (Bacs operators, participating banks)
• Operational resilience gaps (Faster Payments, CHAPS, LINK)
• Governance and conflicts of interest issues (Faster Payments governance review)

Regulatory Role and Function

Statutory Basis

The PSR derives its authority from the Financial Services (Banking Reform) Act 2013 (Schedule 4ZA), Part 13 of the Financial Services and Markets Act 2000 (FSMA 2000), and subordinate regulations. The Financial Services (Banking Reform) Act 2013 received Royal Assent on 18 December 2013 and came into force on 1 April 2015, creating the PSR as part of post-crisis banking and payments reform.

Regulatory Objectives

Under Schedule 4ZA of the Financial Services (Banking Reform) Act 2013, the PSR must advance the following statutory objectives:

1. Protecting Consumers — ensure consumer interests are protected in relation to designated payment systems (including APP fraud reimbursement and fair access)
2. Protecting Stability — protect the stability of designated payment systems, ensuring they remain operational, resilient, and secure
3. Promoting Competition — promote competition in the markets for payment systems and in markets operated by those systems
4. Supporting Innovation — through its competition and stability mandate, support innovation in payment methods, technologies, and services

Corporate Structure & Governance

The PSR is structured as an independent operational subsidiary of the Financial Conduct Authority (FCA). While operationally independent with dedicated staff and regulatory mandate, the PSR is legally part of the FCA and subject to FCA governance oversight:

• Leadership: PSR Managing Director and Board with executive and non-executive directors
• Operational Independence: Dedicated PSR staff, rules, and supervisory approach; separate regulatory decision-making within statutory mandate
• Governance Coordination: PSR Board reports to FCA Board; FCA retains ultimate regulatory authority
• Budget & Funding: PSR budget integrated into FCA; funded through payment system operator fees and regulatory levies

This structure reflects the specialization required for payment systems regulation while maintaining consistency with FCA regulatory objectives and UK financial stability frameworks.

Funding Mechanism

The PSR is funded through:

• Payment System Operator Fees — annual regulatory fees charged to designated payment system operators based on regulatory costs and system size
• Regulatory Levies — fees charged to payment system participants (banks, payment institutions) using designated systems
• FCA Integration — costs recovered through FCA's overall budget and fee structure

The PSR operates on a cost-recovery basis, ensuring payment system regulation is self-funded by industry stakeholders rather than public taxation.

System Operator Governance Requirements

Designated payment system operators must establish robust governance frameworks as required by PSR rules:

1. Independent Board Governance

• Independent Board or Governance Committee with non-executive members
• Clear separation between operator management and system governance
• Transparent policy-setting and decision-making procedures
• Regular board meeting schedules with documented decisions

2. Conflicts of Interest Management

• Identification and management of conflicts between:
• System operator commercial interests vs. fair access principles
• System participants (bank stakeholders) vs. consumer protection
• Card system operators (Visa, Mastercard) vs. competitive neutrality
• Independent oversight of conflicts; transparency requirements

3. Stakeholder Engagement

• Formal processes for consulting with system participants and other stakeholders
• User groups and forums for feedback on operational and governance issues
• Transparent dispute resolution procedures
• Regular communication of policy changes and operational updates

4. Financial Management

• Transparent, cost-based fee structures
• Cost allocation methodologies
• Regular financial reporting
• Investment planning for system modernization

Operational Requirements

1. Technical Standards

• System availability and uptime requirements (typically 99.5%+ availability)
• Technical security standards and cyber resilience
• API access standards (for emerging systems like NPA)
• Interoperability requirements (where applicable)

2. Business Continuity & Disaster Recovery

• Business continuity plans with regular testing
• Disaster recovery capabilities with RPO/RTO targets
• Alternative site operations
• Communication procedures during outages

3. Risk Management

• Liquidity risk management and monitoring
• Credit risk controls (settlement finality, credit limits)
• Operational risk framework
• Cyber risk assessment and mitigation
• Third-party and outsourcing risk management

4. Fraud Prevention (Bacs, Faster Payments, CHAPS)

• Confirmation of Payee (CoP) checks on payment recipients
• Fraud detection and prevention measures
• Consumer reimbursement processing for APP fraud victims
• Coordination with participating banks on fraud prevention

5. Reporting & Transparency

• Regular operational data submission to PSR
• Risk management and compliance reporting
• Annual governance certifications
• Public disclosure of key operational metrics

Payment System Operator Governance Models

Different designated systems have different governance structures, all subject to PSR oversight:

1. Industry-Owned Systems (Bacs, CHAPS, Faster Payments)

• Owned by payment industry participants (banks, building societies)
• Board includes bank representative and independent directors
• User committees and stakeholder engagement forums
• Non-profit or mutual structure

2. Private Company Systems (LINK, Mastercard, Visa)

• LINK: Mutually-owned by major banks and independent operators
• Mastercard/Visa: Shareholder-owned corporations with international ownership
• Board governance required by PSR; stakeholder engagement mandated
• Investor return objectives balanced against regulatory requirements

3. Emerging Systems (NPA — New Payments Architecture)

• New independent authority being established
• Designed with strong governance, stakeholder engagement, and innovation focus
• PSR regulatory oversight from inception
• Public-private partnership model

Governance Requirements Applied by PSR

Regardless of ownership structure, PSR mandates:

• Independent Board Oversight: Governance structures with independent directors/advisors
• Conflict Management: Processes to manage conflicts between operator commercial interests and fair access principles
• Stakeholder Engagement: Formal consultation with system users (banks, payment providers, consumers)
• Transparency: Public disclosure of governance, fees, participation criteria, policy decisions
• Accountability: Regular reporting to PSR; audit and compliance certifications

Legal Foundation

Established by primary legislation enacted by the national legislature. The enabling statute defines the regulatory mandate, scope of authority, governance structure, and enforcement powers.

Licensing and Authorization Relevance

The REGULATOR PAGE METADATA issues authorizations within its regulatory mandate in United Kingdom:

[Specific license types and requirements require verification from official sources]

Payments and Money Movement Relevance

1. Bacs (Domestic Bank Transfers)

Operator: Bacs Payment Schemes Limited

Function: Primary system for domestic bank-to-bank transfers (retail payments, SME transactions, salary payments, bill payments)

PSR Regulation:

• Access: Fair participation criteria for banks and payment institutions
• APP Fraud: Mandatory reimbursement for APP fraud victims; Confirmation of Payee checks
• Operational Standards: Business continuity, fraud prevention, consumer protection
• Fees: Transparent pricing; cost-based fee allocation

Transaction Volume: Approximately 1.4 billion transactions annually (primary retail payment system)

2. CHAPS (High-Value Clearing)

Operator: Pay.UK (formerly CHAPS Co)

Function: High-value, real-time payment clearing for large corporate, institutional, and government payments

PSR Regulation:

• Access: Tiered participation criteria (direct and indirect access); fair criteria
• Operational Resilience: 24/5 operation; redundancy; cyber security
• Risk Management: Liquidity risk controls; credit risk limits
• Fees: Transparent pricing; cost-based fee structures

Transaction Volume: Approximately 5+ million transactions annually; £500+ billion daily settlement

3. Faster Payments & New Payments Architecture (NPA)

Current Operator: Pay.UK (Faster Payments) / Transitioning to NPA Authority

Function: Instant payment clearing; transitioning to modernized New Payments Architecture supporting instant, embedded, and new payment models

PSR Regulation:

• Access: Expanded access to support fintech, non-bank payment providers, embedded payments
• Speed: Commitment to <10 second clearing; future <2 second targets (NPA)
• Innovation: Supporting new payment capabilities (e-invoicing, embedded payments, cross-border)
• Operational Standards: Modern technical infrastructure; API-based access; cloud-capable architecture

Transition Timeline: Migration to NPA ongoing; expected to improve UK instant payment infrastructure significantly

4. LINK (ATM Network)

Operator: Link Group

Function: National ATM network providing cash withdrawal access; primary UK cash access system

PSR Regulation:

• Access: Fair ATM network access for banks, building societies, and independent operators
• Fee Control: ATM withdrawals and cash access pricing
• Consumer Protection: Availability of cash access across UK regions; fee transparency
• Financial Inclusion: Ensuring underserved communities maintain cash access

Network Size: Approximately 45,000+ ATMs (largest UK network)

5. Mastercard Payment System

Operator: Mastercard Europe

Function: International card payment system for debit and credit card transactions

PSR Regulation:

• Interchange Fees: Maximum interchange fee caps for credit and debit card transactions
• Access: Fair criteria for card issuers and acquiring banks
• Consumer Protection: Fee transparency; dispute resolution
• Stability: Operational resilience; cyber security

Regulatory Details: PSR sets maximum interchange fees (currently 0.3% for debit, 0.9% for credit); conducts periodic reviews

6. Visa Payment System

Operator: Visa Europe (formerly) / Visa Inc. (now)

Function: International card payment system for debit, credit, and prepaid card transactions

PSR Regulation:

• Interchange Fees: Maximum interchange fee caps (lowest regulatory caps in EU/UK)
• Access: Fair participation criteria for card issuers and acquiring banks
• Consumer Protection: Dispute resolution; transparency in fees and terms
• Competition: Monitoring for anti-competitive conduct in card system governance

Regulatory Details: PSR oversight of UK card system operations; interchange fee coordination with EU (post-Brexit considerations)

7. Cheque Clearing System

Operator: Voca / Pay.UK

Function: Paper cheque clearing and settlement (legacy system; volumes declining)

PSR Regulation:

• Access: Fair participation for banks handling cheques
• Operational Standards: Clearing timelines; fraud prevention; consumer protection
• Transition: Monitoring long-term viability; coordinating with firms on cheque decline management

Volume Trend: Declining (approximately 500 million cheques annually; downward trajectory)

Access Requirements

The PSR mandates that designated payment systems maintain fair, non-discriminatory access criteria. Key principles:

1. Non-Discrimination

• Access criteria must be objective, non-discriminatory, and transparent
• Cannot deny access based on nationality, geography, or company type
• Cannot impose unreasonable barriers to new entrants or competitors

2. Proportionality

• Participation requirements must be proportionate to systemic risk and operational needs
• Cannot impose excessive capital, technical, or compliance burdens without justification
• Requirements scaled by firm size and business model where appropriate

3. Transparency

• Access criteria publicly documented and easily accessible
• Clear procedures for application, approval, and appeal
• Disputes resolved through formal processes

4. Fairness

• No preferential treatment for certain participants (e.g., system operator shareholders)
• Pricing and participation terms applied consistently
• Conflicts of interest managed to ensure fair treatment

Access Dispute Resolution

If a firm is denied access or feels participation terms are unfair, the PSR provides formal dispute resolution:

1. Access Application Denial: Firm appeals to PSR; PSR investigates whether denial was justified
2. Unfair Participation Terms: Firm challenges fees or requirements as anti-competitive; PSR assesses
3. PSR Decision: PSR can order system operator to grant access or modify terms
4. Enforcement: PSR orders are binding on system operators

Recent cases have resulted in:

• CHAPS providing "synthetic" access for non-banks through bank intermediaries
• Faster Payments establishing tiered access for new entrants and fintechs
• LINK establishing fair criteria for independent ATM operators

Payment Systems Governed or Overseen

The Payment Systems Regulator (PSR) has designated and actively regulates the following critical UK payment systems under its statutory competition and access mandate (Part 18 of the Financial Services and Markets Act 2000, as amended):

Designated Payment Systems (Regulatory Oversight)

System Components Under PSR Oversight

Faster Payments Components:

• Direct Credit service (wages, benefits disbursement)
• Direct Debit service (~5bn transactions forecast 2025)
• Internet and Telephone Banking Payment (ITBP)

Bacs Components:

• Direct Credit (employer/government payroll)
• Direct Debit (recurring bill payments)
• Standing Order function

Payment Firms and Access Regulation

The PSR regulates fair and non-discriminatory access to designated systems for:

Emerging and Replacement Systems

Payments Industry Infrastructure and Services

The PSR also coordinates with entities managing supporting infrastructure:

Statistical Overview (2025 Data)

Total Payment System Volumes:

• Faster Payments: 5.1bn+ instant payments
• Bacs: 6.81bn transactions (2024 full year)
• Direct Debit: ~5bn transactions (forecast 2025)
• Direct Credit: ~1.8bn transactions (wages/benefits)
• Image Clearing System: ~1-2m cheque items daily
• CHAPS: 53.3m high-value payments, £93.9tn

Key Performance Metrics:

• Payment Speed: Faster Payments now supporting 31m open banking payments/month
• Accessibility: Vast majority of UK businesses can access designated systems
• Innovation: 13.3m active open banking users (March 2025)

Consumer and System Protection Mechanisms

The PSR enforces consumer protections at the system level:

Regulatory Instruments and Enforcement

• Principle-Based Rules: Access, governance, interoperability
• Specific Directions: Binding mandates for system operators and participants
• Competition Law: Concurrent authority with CMA under Chapter II provisions
• Consultation and Standard-Setting: Active engagement with industry on technical standards (ISO 20022 migration)

Relationship to Other Regulators

Financial Conduct Authority (FCA) — Parent Regulator

Relationship: The PSR is a statutory operational subsidiary of the FCA. The FCA retains ultimate regulatory authority while the PSR operates as a specialized, independent regulator.

Coordination Areas:

• Consumer Protection: FCA regulates firm-level consumer protections (authorization, FSCS, FOS); PSR regulates system-level protections (APP fraud reimbursement, access, stability)
• Payment Firms Regulation: FCA authorizes payment institutions and e-money institutions; PSR ensures those firms have fair access to designated systems
• Financial Stability: FCA and PRA coordinate on prudential matters; PSR focuses on payment system operational resilience
• Budget & Governance: FCA Board retains ultimate budget authority; PSR Board reports to FCA Board

MOU & Coordination: Formal coordination documents and information-sharing protocols govern FCA-PSR relationship.

Bank of England — Stability & Monetary Policy

Relationship: Bank of England (BoE) is UK's central bank; PRA (subsidiary of BoE) oversees prudential regulation of banks and major payment firms. BoE also conducts macroprudential oversight.

Coordination Areas:

• Payment System Stability: BoE monitors payment system resilience and stability; PSR focuses on operator and access regulation
• Critical Infrastructure: BoE designates critical payment systems; PSR regulates those systems
• Prudential Regulation: PRA regulates banks participating in payment systems (capital, liquidity); PSR regulates system-level participation requirements
• Macroprudential Oversight: BoE Financial Policy Committee monitors systemic risks; PSR shares payment system data

Information Sharing: Regular coordination between PSR and BoE teams on payment system stability matters.

Competition and Markets Authority (CMA) — Competition Law

Relationship: CMA has concurrent competition law jurisdiction over payment systems alongside PSR regulatory authority.

Division of Responsibilities:

• CMA: Enforces UK/EU competition law (competition law breaches, merger control, cartel enforcement)
• PSR: Regulates payment systems through specialized rules (access, fees, governance)

Coordination: Information-sharing agreements and coordination protocols for matters affecting payment system competition. CMA may investigate; PSR may enforce regulatory requirements.

Examples: CMA investigations into card system interchange fees (parallel to PSR fee regulation); CMA review of Mastercard/Visa conduct (parallel to PSR oversight).

Prudential Regulation Authority (PRA) — Bank Regulation

Relationship: PRA regulates banks and major payment firms for prudential (safety/soundness) purposes.

Coordination Areas:

• Operational Resilience: PRA sets operational resilience standards for banks; PSR sets payment system-level standards
• Risk Management: PRA requires capital/liquidity management; PSR requires participation in system risk management
• Payment System Participation: PRA-regulated banks are major payment system participants; PSR ensures fair access and participation standards

Dual Regulation Coordination: Where a payment system operator is a PRA-regulated firm, both PRA and PSR oversight apply (PRA on prudential matters, PSR on system regulation).

Geography and Jurisdiction Notes

Jurisdictional Scope

The PSR exercises national-level jurisdiction over the United Kingdom:

• England, Scotland, Wales, Northern Ireland — Full jurisdiction over payment systems used in all UK constituent countries
• Crown Dependencies and Overseas Territories — Limited PSR jurisdiction; separate regulatory regimes apply (e.g., Jersey, Guernsey, Isle of Man, Gibraltar have own regulators)
• Cross-Border Payments — PSR regulates UK-based operators and participants in international payment systems; international coordination through payment system governance

Regulatory Reach

The PSR regulates:

1. System Operators in the UK — All designated system operators (regardless of ownership nationality) operating systems in/from the UK
2. UK-Based Participants — All UK firms (banks, payment institutions) participating in designated systems
3. Foreign Firms Operating in UK — Foreign payment service providers accessing UK designated systems must comply with PSR access requirements
4. Cross-Border Payments — For international systems (Visa, Mastercard), PSR regulates UK-relevant operations, fees, and access

Post-Brexit Considerations

Since UK departure from EU (31 January 2020 / regulatory changes 1 January 2021):

• PSR maintains independent regulatory authority (no longer subject to EBA, European Commission oversight)
• PSR cooperates with EU regulators through bilateral arrangements
• UK interchange fee caps may diverge from EU caps (currently aligned but independent)
• New Payments Architecture modernization is UK-specific; EBA's Pan-European Instant Payment system separate

Important Departments and Divisions

Key Public Resources

PSR Official Resources

Rulebook & Regulatory Guidance:

• PSR Rulebook — Complete regulatory framework
• System-Specific Rules — Rules by system
• Access Guidance — Access requirements and dispute resolution
• Approach Documents — Supervisory strategy and enforcement approach

Consumer Resources:

• APP Fraud Reimbursement Guide — Consumer rights and reimbursement process
• Confirmation of Payee (CoP) Information — Fraud prevention guidance
• System Access Information — Information for consumers on payment system choices

Regulatory Data & Reports:

• PSR Annual Reports — Regulatory activity, enforcement, and performance
• Payment Systems Data — Transaction volumes, participant data, fee information
• Enforcement Actions — Public enforcement decisions and penalties

Legislation & Legal Framework

• Financial Services (Banking Reform) Act 2013 — Establishes PSR (Schedule 4ZA)
• Financial Services and Markets Act 2000 (FSMA 2000) — Framework legislation (Part 13 relevant to PSR)
• Payment Services Regulations 2017 — Payment institution framework (related; FCA-regulated)

Bank of England & Related Resources

• Bank of England Payment Systems Oversight — BoE payment system stability oversight
• New Payments Architecture — Modernization initiative (PSR coordinated)
• Faster Payments — Current instant payment system

Notes on Naming and Language