The FCA has identified barriers to the success of Open Banking and future innovation in UK payments. Besides proposing amendments to the Technical Standards on Strong Customer Authentication and Common and Secure Methods of Communication, the FCA will also take this opportunity to amend their guidance on prudential risk management and safeguarding in their Approach Document (AD), and make general updates to a number of areas and onshoring-related changes. FCA’s Perimeter Guidance Manual (PERG) will also receive updates.
One section of the consultation paper, relating to contactless payments, will close on 24 February 2021. The rest will close on 30 April 2021. The payments landscape has grown and evolved in recent years, as business models adapt to user needs. The coronavirus (COVID-19) pandemic has accelerated these changes. This consultation will help the FCA make sure regulatory expectations keep pace with the changing landscape, according to the official press statement.
The FCA seeks to remove identified barriers to continued growth, innovation, and competition in the payments and e-money sector (including Open Banking), while making the sector more resilient and protecting consumers if firms fail. Payment service providers (PSPs) and e-money issuers, as well as trade bodies representing them, should read this consultation. FCA’s proposals affect credit institutions providing payment services and/or issuing e-money, as well as payment institutions (PIs), e-money institutions (EMIs) and registered account information services providers (RAISPs).
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