21/07/2017
A new generation of non-bank payment service providers will be given direct access to UK payment systems in a significant change of Bank of England policy designed to ensure the UK retains a world-leading payment infrastructure as the financial system changes.
Under the BoE’s revised Settlement Account Policy, the non-bank payment service providers have become eligible for the first time to apply for a settlement account in the BoE’s Real Time Gross Settlement (RTGS) system.
As settlement account holders, they will then have direct access to payment systems – such as Faster Payments, Bacs, CHAPS, LINK, Visa, and – once live – the new digital cheque imaging system – which settle in sterling central bank money.
‘Access to UK Payment Schemes for Non-Bank Payment Service Providers’ provides guidance for non-bank PSPs looking to access RTGS.
Reduced dependence on bank competitors for access to payment systems will allow non-bank PSPs to offer a wider range of payment services and help to increase competition and innovation.
In the longer term, the BoE believes it will
- create more diverse payment arrangements with fewer single points of failure
- identify and develop new risk-reducing technologies
- expand the range of transactions that can take place electronically and be settled in central bank money
In preparation for the advent of the first non-bank PSPs during 2018, the Bank has been working over the past year with the Financial Conduct Authority, HM Treasury, HM Revenue & Customs, the Payment Systems Regulator (PSR) and the payment system operators to develop a comprehensive risk management framework to ensure the continued resilience of the Bank’s RTGS service.
‘A blueprint for a new RTGS service for the United Kingdom’ sets out a clear high-level statement of how the new RTGS service will look and a roadmap for how it will be delivered over the coming years.