TransferWise joins UK’s Faster Payments system
TransferWise has become the first non-bank payment service provider (PSP) to directly access the UK’s Faster Payments system.
PSP OK UK
The Bank of England (BoE) says a “key component” of this work involved it extending settlement account access in its real-time gross settlement (RTGS) system to non-bank PSPs.
Mark Carney, governor of the Bank of England, says: “By stimulating competition and innovation, we anticipate increased diversity and risk-reducing payment technologies will reinforce financial stability while enhancing customer service.”
To give you some background, on 19 July 2017 the central bank announced that non-bank PSPs were eligible to apply for a settlement account in its RTGS system.
According to the BoE, this change enabled non-bank PSPs to access directly the UK payment schemes that settle in central bank money for the first time, including Faster Payments, Bacs, CHAPS, LINK, Visa, and the new digital cheque imaging system.
The bank worked with the Financial Conduct Authority (FCA), HM Treasury, HM Revenue & Customs, the Payment Systems Regulator (PSR) and the system operators to enable access “whilst safeguarding resilience”.
Allowing non-banks to hold a settlement account in RTGS is “just one way” in which the bank and the wider UK regulatory community is broadening access to the RTGS system.
In May 2016 the bank set out a blueprint for a renewed RTGS service. It says with an increasing number of payments being made through this system, it anticipates that widening access to CHAPS and payment schemes that settle over RTGS will “help to increase competition and innovation in the provision of payment services”.
This work also supports the objectives of the PSR and FCA – who often talk about how they want to promote competition and innovation as well.
The BoE adds that any firms interested in accessing the UK payment systems directly should contact the relevant systems operator to discuss these issues further.
