Credit, Collections & Insolvency News
The Payments Systems Regulator (PSR) and the Financial Conduct Authority (FCA) are scrutinising the benefits and potential risks of digital wallets as analysis suggests that over half of adults may be using services like Apple Pay, Google Pay, and PayPal. As well as looking at the advantages digital wallets offer consumers, the regulators will also explore if there are elements that could hinder payment efficiency.
The regulators will also gather evidence on whether the technology carries any substantial issues related to competition, consumer protection, or market integrity.
The regulators are keen to better understand the impact on consumers and businesses that digital wallets’ increasing popularity creates, including understanding the range of benefits that digital wallets bring for service users and whether there are any features that mean payments don’t work as well as they could for consumers and/or businesses.
The regulators also want to understand their role in unlocking the potential of account-to-account payments and how they could impact competition between payment systems; and whether digital wallets could raise any significant competition, consumer protection or market integrity issues, either now or in the future.
David Geale, the PSR’s Managing Director said “Digital wallets are steadily becoming a go-to payment type and while this presents exciting opportunities, there might be risks too.
“Collaboration between regulators and working with industry is crucial to ensure we’re on the front foot to support innovation and competition, making sure everyone benefits from access, protection and choice in payments. We look forward to hearing views and evidence from a wide range of stakeholders throughout this process.”
Nikhil Rathi, the FCA’s Chief Executive, said “The UK is seeing a seismic shift in how people pay, as digital wallets become a part of everyday life for many people. We want to make sure we can maximise the opportunities and benefits for consumers and businesses while protecting against any risks this technology may present.”