The payments and e-money sectors are booming at present, and that has not gone unnoticed. While much of the FCA’s proactive supervisory work has been on pause in recent months, the risk seen to be posed by these businesses is a critical one to be managed in the FCA’s eyes.
Last week a portfolio strategy letter was sent to the CEOs of payment institutions (PIs) and e-money institutions (EMIs) highlighting 6 key areas that the FCA wants the senior management of PIs and EMIs to prioritise. The letter comes hot on the heels of the FCA’s May consultation which focussed on tightening key controls in PIs and EMIs.
You can read more on that in our earlier post. Consumer protection given the rapid uptake in use of payment services is at the heart of these interventions.
The six areas the FCA wants the senior management of PIs and EMIs to focus on are as follows:
1. Improved safeguarding of consumer funds
2. Vigorous management of prudential risk
3. Active combatting of financial crime
4. Appropriate, accurate consumer communications
5. Robust governance of the institution
6. Complete and accurate record-keeping and reporting #
The PI or EMI needs to also raise these issues with any appointed agents and ensure that they comply.