The Payment Systems Regulator (PSR) has published its final report on its market review into the ownership and competitiveness of infrastructure provision.
In summary the PSR found that:
- there is no effective competition for the provision of UK payments infrastructure for the three main interbank payment systems (Bacs, FPS and LINK);
- there is a lack of incentives for operators to look for alternative infrastructure providers that could better meet the needs of their service-users. The PSR considers that this is partly due to the fact that the operators and the infrastructure provider are both owned and controlled by the payment service providers who use them; and
- there are barriers to entry that prevent or deter potential central infrastructure providers from competing to provide these services.
The PSR also considers a number of potential remedies that include competitive procurement exercises, enhancing interoperability, including a common international messaging standard for Bacs and FPS and divestment by the four largest VocaLink shareholders of their interest in VocaLink.
The deadline for comments on the potential remedies is 22 September 2016.