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The paper identifies potential gaps in protections for consumers, with a focus on consumer-to-business payments via the Faster Payments System.

By Christian F. McDermott, Claudia Sousa, and Alain Traill

In November, Pay.UK, the retail payments authority, released a summary paper exploring the consumer protection landscape relating to disputed retail payments.

The paper, titled “Consumer Protections in Payments”, was released in the context of changes in the usage of Pay.UK’s systems following recent regulatory developments, including the EU’s revised Payment Services Directive (2015/2366, known as PSD2) and the Open Banking initiative in the UK. Focusing in particular on real-time consumer-to-business (C2B) payments using the Faster Payments System (FPS), the paper explores the protections currently in place and consumers’ understanding of those protections. Together with ongoing primary research, the paper will be used to inform further policy work by Pay.UK and, potentially, introduce new rules and standards.

MAS confirms regulatory approach for derivative contracts on payment tokens.

By Farhana Sharmeen and Marc Jia Renn Tan

On 15 May 2020, the Monetary Authority of Singapore (the MAS) issued its response to feedback about its proposed regulatory approach for derivative contracts that reference payment tokens as underlying assets (Payment Token Derivatives), confirming that it will regulate Payment Token Derivatives offered to Singapore investors through approved exchanges. (See MAS’ current list of approved exchanges.) The MAS considers it crucial that it has effective oversight of products offered on approved exchanges due to the systemic importance of such trading facilities and the risk of contagion to the wider financial system.