LONDON, May 4 (Reuters) - Britain's multi-trillion pound
system for shuffling payments and cheques will be streamlined
under plans announced on Thursday to help newcomers compete more
easily with long established banks and improve services to
Britain is keen to increase competition in banking, a sector
dominated by the "Big Four" lenders - Lloyds, HSBC, Barclays and
RBS. Any new banks have to use existing payments systems,
largely set up by the big lenders, for a fee.
A group created by the Payment Systems Regulator (PSR) and
Bank of England recommended on Thursday that the three retail
payment systems, Bacs, Cheque and Credit Clearing Company, and
Faster Payments Scheme be consolidated under one roof.
That would mean new banks will only have to make one
application to use all the three systems, thereby speeding up
the process and cutting costs.
"The consolidation would be an important first step towards
a generational change in UK payments," PSR Managing Director,
Hannah Nixon, said in a statement.
"Consumers will also benefit from new entrants coming into
the market and offering users of payment services new,
Although only a recommendation, in practice the three
payments firms have little choice but to accept the proposal by
the regulator and the BoE.
The PSR has powers to force through changes.
"We welcome the report, and look forward to seeing its
recommendations taken forward in a way which promotes an orderly
and smooth transition," said David Bailey, the BoE's director
for financial market infrastructure.
It is expected that the consolidation will be substantially
completed by the end of 2017, the PSR said.
"While good progress has been made, support from across the
industry is vital and significant collaborative work still needs
to be done if the plan is to be delivered successfully and the
benefits of the consolidation unlocked," said Robert Stansbury,
who chairs the joint BoE, regulator, delivery group.
(Reporting by Huw Jones; Editing by Elaine Hardcastle)