On 2 February 2017, we blogged that HM Treasury published a consultation paper on implementation of the revised Payment Services Directive (PSD2). On 3 February 2017, we also blogged that the FCA updated its webpage on the revised PSD2 to include a new timeline section which indicated that FCA expects to consult on the necessary changes to its guidance and Handbook rules early in the second quarter of 2017.

The FCA has now published Consultation Paper 17/11: Implementation of the revised Payment Services Directive: draft Approach Document and draft Handbook changes (CP17/11). CP17/11 consults on the following:

  • Chapter 2 – Changes to the perimeter. In this chapter the FCA consults on: (i) proposed changes to the Perimeter Guidance Manual to reflect the extended scope of PSD2, and the changes to exclusions available to businesses. The FCA addresses some other issues, including those that arose in response to its Call for Input; and (ii) proposed new notifications that businesses will need to follow if they wish to rely on certain exclusions;
  • Chapter 3 – The FCA’s approach to authorisation and passporting. In this chapter the FCA consults on: (i) proposed approach to authorisation under PSD2, including the new requirements for business seeking to become authorised and registered and requirements for payment institutions (PIs) and existing electronic money institutions (EMIs); and (ii) change in qualifying holdings and passporting: the FCA’s proposed approach to changes in qualifying holdings of authorised PIs and the new requirements for businesses passporting under PSD2;
  • Chapter 4 – Conduct of business including complaints handling. In this chapter the FCA consults on: (i) proposed changes to guidance and the FCA’s Handbook rules related to the conduct of business of payment services providers (PSPs) and other providers of retail banking services; and (ii) proposed changes to the FCA’s complaints handling rules to implement PSD2. This is in part a joint consultation with the Financial Ombudsman Service;
  • Chapter 5 – Regulatory reporting. In this chapter the FCA consults on: (i) proposed changes to the FCA’s Handbook to introduce new complaints reporting requirements for PSPs; (ii) proposed approach to collecting data on payment services fraud, as required under PSD2; (iii) proposed revisions to the reporting required from PIs and EMIs in order to allow the FCA to supervise these businesses effectively; and (iv) proposal that authorised PIs submit annual controllers report and close links reports;
  • Chapter 6 – Payment service providers’ access to payment account services. This chapter includes proposed new guidance on FCA expectations on access to payment account services for PIs, EMIs and registered account service providers being provided by credit institutions. The FCA is consulting on this together with the Payment Systems Regulator;
  • Chapter 7 – Account information services and payment initiation services and confirmation of availability of funds. In this chapter the FCA consults on: (i) proposed approach to regulating providers of payment services business newly brought under regulation, Account Information Service (AIS) and Payment Initiation Services (PIS); and (ii) the FCA’s expectations of how should account servicing payment service providers meet their obligations in respect of providers of AIS and PIS and to card based payment instrument issuers, including the notification required when access is denied;
  • Chapter 8 – The FCA’s approach to supervising the Payment Service Regulator 2017 (PSR 2017) and Electronic Money Regulations. In this chapter the FCA consults on proposed changes to the FCA’s approach to supervisions under PSR 2017 and Electronic Money Regulations;
  • Chapter 9 – Consequential changes and other revisions to the Approach Document. In this chapter the FCA consults on: (i) minor changes to the Handbook necessary to implement PSD2; and (ii) proposed wider revisions to the Payment Services and E-money Approach Documents; and
  • Chapter 10 – the Payment Systems Regulator’s approach. In this chapter the FCA consults on: (i) the PSR’s expectations on direct and indirect access to payment systems for PSPs; (ii) proposed guidance on the PSR’s expectations about information on ATM withdrawal charges to be provided by Independent ATM providers; and (iii) the PSR’s proposed approach to enforcing the requirements of the PSRs 2017 for which it is responsible.

The FCA will consult separately on regulatory fees for PSPs, including changes resulting from PSD2, in its spring 2017 fees consultation paper. The deadline for comments on CP17/11 is 8 June 2017 with a view to publish a policy statement in Q3 2017.

View FCA consults on implementation of PSD2, 13 April 2017