The UK Financial Conduct Authority (FCA) and the UK Payment Systems Regulator (PSR) have published a joint response to HM Treasury's consultation on consolidating the PSR's functions within the FCA's legislative framework. Both regulators support the proposed integration, agreeing with the overarching approach to the consolidation, and believe that the proposed model enables a coherent and holistic view of regulatory issues that impact payment systems and payment services. Their response outlines work already completed as well as ongoing efforts to prepare for the transition. In terms of next steps, beyond development of the detailed legislation, and in the longer term, they consider that there may be aspects of the FSMA regime that may be appropriately adapted to payment systems regulation. There may also be further opportunities to review how the developing regime for the regulation of activities involving stablecoins or other crypto-assets fits together with the regulation of systems that use such technology to transfer funds. In the accompanying annex, the PSR and FCA set out their responses to the specific consultation questions. You may also like to read our opinion piece "UK Payment Systems Regulator to be abolished - what's next?" which explores key considerations and potential impact of the transition of the consolidation.
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