The Payment Systems Regulator (PSR) has launched a discussion paper about data in the payments industry.
Payments-related data is becoming increasingly important, and its use is growing fast. As a result, the regulator is examining how this can affect the payments industry and consumers.
Hannah Nixon, managing director of the PSR, said: “The UK’s payments sector is rapidly evolving and data is becoming increasingly important. Every time you make a payment or withdraw money, you generate data. That’s why we’re looking to understand what actions we might need to take in the future around the use of data in payment systems.
“We’ve identified three key areas we’re going to explore in more detail and are looking for everyone’s views. With this input, we’ll be able to take the right actions to shape the use of data in payment systems for the benefit of everyone.”
The way payments data is collected, used and shared presents opportunities and risks for payment service providers (PSPs) and the people and organisations that use payment systems. It could, for example, create new business models and improve access for new entrants into the sector, stimulating competition and innovation, which will lead to greater choice for everyone who uses payment systems. It could also enhance the detection of financial crime and strengthen protections, although some of these opportunities might not happen through market forces alone. On the other hand, the increased commercial use of data could influence how companies gain competitive advantage, which could have implications for end users in terms of the range or quality of services offered.
As a result, the regulator is keen to understand the opportunities and risks of the changing treatment of data in the payments industry, and what role the PSR could play to make sure new uses of data work well for the people and businesses that use payment systems. This could be through removing barriers to setting up new services, or through mitigating risks associated with evolving uses of payments data.
The deadline for providing views is 5pm on September 3.