The UK Payment Systems Regulator (PSR) has published consultation paper CP25/2 alongside a new webpage, proposing the revocation of Specific Direction 4 (SD4) and its amendment, SD4a. SD4, introduced following the PSR's 2016 infrastructure market review, requires the operator of the LINK payment system to procure its central infrastructure every ten years via a competitive process. The PSR now considers this requirement may no longer be an effective means of addressing competition concerns, due to evolving market conditions (in particular, decreased cash withdrawals and reduced scheme revenues). Instead, the PSR proposes that active regulatory oversight of LINK and its infrastructure provider, Vocalink, would be a more effective way to mitigate risks associated with a monopoly position. The consultation seeks views on the proposed revocation, particularly the risks the removal may create on competition, innovation and end-user outcomes, and how enhanced supervision of LINK and Vocalink could help address them. The deadline for responses is by 5:00pm on 17 July.
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