On 23 October 2025, the Financial Conduct Authority (FCA) and the Payment Systems Regulator (PSR) (the regulators) jointly responded to the HM Treasury’s (HMT) consultation on consolidating the PSR’s functions.

Summary

The regulators explained that they welcome the proposal set out in HMT’s consultation that the FCA take on the PSR’s responsibilities, including in relation to promoting competition and innovation in payments systems, as well as supporting the interests of consumers who make payments.

The regulators also set out that they agreed with the overarching approach to the consolidation on the basis that the proposed model will help to facilitate a holistic view of regulatory issues that affect payments.

In addition, the regulators further set out where they have already been seeking to increase efficiency and take a joined-up approach, such as by having joint project teams. They also explained that they agreed with HMT’s proposal to keep the PSR’s core functions the same, enabling a continuation of the economic regulation of payment systems. Finally, the regulators made clear that they have been working with HMT to identify specific areas where the legislative and regulatory framework could be streamlined or enhanced as part of this process.

Next steps

The regulators explained in this response that they will continue to work with HMT to support this transition, in particular to ensure that the review of relevant legislation allows for effective integration of the two regimes.