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The merger’s happening. David Geale from the FCA dropped the news at London’s MoneyLIVE Summit today, saying his agency will absorb the Payment Systems Regulator within months as part of a sweeping plan to streamline Britain’s financial oversight.
Geale, who runs payments and digital finance at the Financial Conduct Authority, said the consolidation will end years of regulatory ping-pong for firms dealing with both agencies. The PSR focused on payment system plumbing while the FCA handled consumer stuff, but that split doesn’t make much sense anymore. “Our aim is to minimize disruption,” Geale said, though he didn’t specify exactly when the PSR will disappear. The government floated this idea about a year back, and both regulators pretty much welcomed it from the start.
Things are moving fast now.
The FCA already started hiring PSR staff and building joint teams to handle the transition. A new payments horizon scanning unit combines people from both agencies, basically creating a preview of what’s coming. Geale said this setup helps align priorities and keeps projects moving while lawyers work out the legislative details. The PSR will keep its current structure temporarily, but its powers are shifting over piece by piece.
Treasury officials completed their consultation on the merger recently. A detailed roadmap should drop by mid-year, spelling out exactly how the consolidation will work and who does what under the new setup. That’s when firms will get clearer guidance about navigating the combined regulator.
But the FCA isn’t waiting around.
The agency held workshops with industry players in early March, gathering feedback about potential problems with the merger. These sessions covered everything from ongoing PSR projects to concerns about regulatory continuity. Geale said the outreach shaped their integration strategy, though he didn’t share specifics about what changes resulted from the feedback.
One thing that won’t change is the PSR’s existing work. Projects aimed at improving payment system resilience will continue under FCA oversight, according to officials briefed on the transition. The regulator wants to maintain consistency in ongoing measures while the bureaucratic machinery grinds through the consolidation process. This follows earlier reporting on FCA Eyes Motor Finance Compensation Rules.
Digital finance oversight gets a boost too. Geale pointed out that rapid growth in digital payments requires robust regulatory frameworks that can adapt to new tech. The merged entity aims to monitor digital finance innovations more effectively while maintaining system integrity. He thinks the consolidation will create a more efficient regulator overall.
Market watchers are paying attention. Financial analysts see this merger as potentially setting precedent for future regulatory strategies across the UK financial sector. The FCA’s approach could become a model for other countries considering similar consolidations, though the full effects remain unclear.
The FCA plans a public forum on March 15 where industry reps can voice concerns and get clarity on merger impacts. The event represents part of the agency’s push for transparency during the transition. Regular updates will keep stakeholders informed as the regulatory landscape shifts, according to Geale.
Competition, access, and innovation remain core priorities under the new structure. The FCA sees these factors as critical drivers of market effectiveness and growth. Geale said the merger should enhance coordination and clarify responsibilities within the regulatory framework, making life easier for firms that previously had to navigate between two separate bodies.
No timeline exists yet for completing the legislative changes needed to finalize the consolidation. The Treasury report expected by mid-year should provide more concrete details about roles and responsibilities under the combined regulator. Until then, both agencies continue working closely to ensure a smooth transition. See also: Suspect Arrested in France for .
The PSR’s governance structure stays in place temporarily as powers transfer over. Government consultation wrapped up recently, but officials haven’t released results publicly. Industry sources suggest the feedback was generally positive, though some firms raised concerns about potential gaps during the transition period.
Geale didn’t provide additional comments about specific challenges the merger might face. Preparations continue as both organizations work toward integration, with the FCA taking the lead on most coordination efforts. The consolidation represents one of the biggest changes to UK financial regulation in recent years.
Reached for comment, Treasury officials didn’t respond to questions about potential delays or obstacles to the merger timeline.
The PSR currently oversees roughly £100 trillion in annual payment transactions across the UK, making it a significant regulatory force despite its smaller staff of around 100 employees compared to the FCA’s 4,000-strong workforce. Major payment processors like Mastercard, Visa, and domestic schemes such as Faster Payments have already started adjusting their compliance frameworks in anticipation of dealing with a single regulator instead of two separate entities.
Industry lobbying groups including UK Finance and the Payments Association have been pushing for clearer guidance on how existing PSR enforcement actions will transfer to the FCA. Several ongoing investigations into payment system access and pricing could face delays if not properly handed over, creating uncertainty for firms already under scrutiny from both regulators.
