Visa and MasterCard face scrutiny by new UK watchdog

The UK government is planning to put supervision of MasterCard and Visa alongside the country’s main interbank payment systems into the hands of a new Payment Systems Regulator (PSR), whose chief remit is to inject more competition into the country’s payments industry.

In 2013 the government announced the creation of a new, economic regulator charged with increasing competition and innovation in the payments sector, which has traditionally been dominated by a small number of systems and the big banks.

From April next year, the PSR will have strong new powers to ensure the way the country’s main payment systems are run do not hold back competition in the sector, including requiring competitors such as challenger banks and smaller firms to have access to these systems on fair terms, and if necessary the power to order the owners of the more established systems to break them up or sell them.

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