Treasury consults on PAD implementation: Treasury is consulting on UK implementation of the Payment Accounts Directive (PAD). It notes the UK had already addressed several of the areas the PAD covers, and that its aim during negotiations had been to align PAD as closely as possible with UK requirements.  Treasury has decided it will not make use of the option to extend the application of PAD so will apply it only where strictly required. The only exception is where UK policy on basic bank accounts already goes further than PAD, and here Treasury proposes to keep the current rules so far as not inconsistent with PAD. Treasury plans to implement PAD through secondary legislation (including secondary legislation amending parts of the Financial Services and Markets Act and Financial Services Banking Reform Act), and has published with the consultation draft regulations, which copy out the relevant PAD text so closely as possible. Key elements of PAD include:

  • comparison of fees and charges: FCA will lead on determining the UK's provisional national list of the most representative services linked to payment accounts;
  • comparison websites: Treasury will require the Money Advice Service to operate a comparison website complying with PAD's minimum requirements and does not expect any other providers to incur costs as a result of PAD;
  • packaged accounts: Treasury plans to impose the PAD obligations on payment service providers only where it is possible for a  consumer to purchase the payment account and the additional service from the same provider, but wants to understand the potential costs this would entail;
  • switching:  Treasury proposes complementary roles for the PSR and FCA in relation to designation of compliant switching arrangements and monitoring and enforcement. Treasury also seeks views on the success and operation of the Current Account Switching Service; and
  • basic bank accounts: Treasury proposes changes to the current UK requirements on basic bank accounts in three areas: eligibility criteria, grounds for refusal to open or terminate a basic bank account and basic bank account fees, charges and costs.

Treasury seeks comments by 3 August. It must adopt implementing laws by 18 September 2016, and these will be followed by EBA guidelines and technical standards, which Member States will need to comply with from late 2017/early 2018. (Source: Treasury Consults on PAD Implementation)