FCA Sets Out Payments Priorities in Single Report

The UK's Financial Conduct Authority (FCA) has published its Regulatory Priorities: Payments report on 25 March 2026, one of nine sector reports that together replace more than 40 portfolio letters sent to firms. The FCA says trust and confidence are essential for growth and competition, and are based on firms meeting proportionate standards.

The FCA describes the reports as "a clear, succinct, one-stop shop" that pulls together its supervisory and policy work. The FCA says its goal is "less intensive attention on firms doing the right thing, and stronger, faster action where harm is greatest."

FCA PRIORITIES FOR PAYMENTS SECTOR

The report outlines key priorities for firms authorised or registered under the Payment Services Regulations 2017 and the Electronic Money Regulations 2011. These include ensuring firms implement the Consumer Duty effectively, with a focus on international payment pricing transparency and how firms treat consumers in vulnerable circumstances. Total customer complaints submitted to the Financial Ombudsman Service against payments firms fell 9% from 2024 to 2025.

Another priority is protecting financial system integrity. Firms are expected to have effective governance arrangements, the right skills, and systems and controls to identify, assess and mitigate risk. The FCA will tackle financial crime, including money laundering, and slow the growth of fraud, including authorised push payment (APP) fraud, cooperating with industry, other regulators, and law enforcement. It will also enhance its operational resilience framework, publishing a policy statement with the Bank of England and Prudential Regulation Authority on incident and third-party reporting rules.

KEEPING CUSTOMERS’ MONEY SAFE

Keeping customers’ money safe is a core priority for authorised payment institutions (except those solely providing payment initiation services or account information services), authorised electronic money institutions, small electronic money institutions, and small payment institutions. The FCA will continue to assess firms' governance, oversight, and systems and controls relating to financial resilience and safeguarding.

The FCA has published a policy statement on changes to the safeguarding regime to address weaknesses in firms’ practices and shared examples to raise standards. Firms should implement the new Safeguarding Supplementary Regime by the time the rules come into force. The FCA will take action against firms that consistently fail to meet standards.

OPEN FINANCE AND INNOVATION

The FCA is committed to building on the success of Open Banking to launch open finance, with an open finance roadmap to be published by the end of March 2026. The FCA expects the regulatory framework for the first open finance scheme to be in place by the end of 2027.

The regulator expects ongoing compliance with the Consumer Duty and will reinforce expectations by engaging with firms, identifying gaps, and taking action where necessary. This includes areas like international money remittance and cross-border payments transparency.

IMPLICATIONS FOR FIRMS AND MARKET

For the payments sector, the single report replaces the previous payments portfolio letter, bringing supervisory and policy priorities together in one document. The FCA asks firms' boards and chief executives to read the reports carefully, review the priorities and act where they need to.

The FCA will also continue policy work on open banking, stablecoins and modernising payments regulation, including considering whether changes are needed to support agentic AI payments. On fraud, the FCA says it will explore opportunities for greater data sharing and use its supervisory intervention and enforcement tools where appropriate.

The Safeguarding Supplementary Regime comes into force in May, and the FCA warns that it may see an increase in 'adverse' safeguarding audit opinions in the short term.