UK’s Starmer Axes Payment Systems Regulator

Turns out the appetite for financial deregulation stretches across the Atlantic. U.K. Prime Minister Keir Starmer on Tuesday (March 11) announced plans to abolish the Payment Systems Regulator (PSR).

The PSR is roughly equivalent to the Consumer Financial Protection Bureau (CFPB), and the decision is part of a broader effort by the Starmer government to streamline regulation while it focuses on small businesses as well as the larger business climate. The PSR is responsible for overseeing payment systems such as the Faster Payments network and Mastercard’s network. It will be consolidated into the Financial Conduct Authority (FCA).

“For too long, the previous Government hid behind regulators — deferring decisions and allowing regulations to bloat and block meaningful growth in this country,” Starmer said in a statement. “And it has been working people who pay the price of this stagnation.”

Tuesday’s announcement does not trigger immediate changes to the Payment Systems Regulator’s mandate or ongoing activities, according to Starmer’s statement. The regulator will retain its statutory powers until Parliament passes legislation to formalize Starmer’s plan.

In the meantime, Starmer said the PSR and the FCA will collaborate to ensure a seamless transfer of responsibilities, maintaining market competitiveness.

This move is part of a broader government initiative, Starmer said, to revitalize economic growth by refining the regulatory framework, ensuring that regulators support rather than hinder progress.

A statement from the PSR supported Starmer’s move.

“We’re committed to working with government, the FCA and the Bank of England as decisions are taken on the transfer of regulatory responsibilities and, when they are, help ensure the process is smooth,” a statement from the organization read.

“Legislation will take time, but we do not need to wait to realize the benefits of an even more streamlined regulatory approach. Doing so builds on recent work bringing the PSR and FCA closer together. We have, for example, already joined the managing director of the PSR role with that of executive director of payments and digital finance at the FCA.”