In support of their November 2016 strategy to change UK payments systems, the Payments Strategy Forum (“PSF”) has published a public consultation titled a "Blueprint for the Future of UK Payments".
The consultation paper notes that although UK payments systems are some of the best in the world, they are no longer fit for purpose due to their age and complexity. In response to this issue, PSF has developed a New Payments Architecture (“NPA”), which will consolidate and replace the current tripartite system of Bacs, Cheque and Credit and the Faster Payments Service and will be implemented over a five-year period.
NPA will operate with a single set of standards and rules, with strong central governance and will be managed by the New Payments System Operator, a newly established conglomerate of the three main UK retail payment system operators; Bacs Payment Schemes Limited, Cheque and Credit Clearing Company Limited and Faster Payments Scheme Limited.
Other key feature of NPA include:
- A layered approach, with a ‘thin’ collaborative infrastructure to enable competition and innovation;
- Adoption of the common, international messaging standard, ISO 20022, to enable access, innovation and interoperability, both in the UK and potentially internationally;
- Security and resilience, with financial stability as a key principle;
- The use of ‘push payments’ to enable simplicity and increase customer control; and
- Flexibility built into the design to support a range of new end-user overlay services such as Request to Pay.
PSF has also proposed a set of seven solutions to improve trust in payments. The consultation will look at two of these solutions, namely ‘Payments Transaction Data Sharing and Data Analytics’, which is focused on detecting and preventing financial crime by creating an industry-wide capability to analyse retail transaction data in conjunction with other relevant information and ‘Trusted Know Your Customer Data Sharing.’
The consultation is open until 22 September 2017 and responses are to be provided in the consultation questionnaire, which can be found here.