Our access work

Access to payment systems is important because it helps to increase competition and innovation, which can bring benefits through lower prices and new products and services to meet different needs.

The PSR has historically published an annual report on developments in access and governance of interbank payment systems, including the progress of our work and the related outcomes.

Since 2023 we have published the information on this web page, rather than as a downloadable report.

The format of the information displayed contains all the necessary charts representing the facts on access. This approach is to make the information more accessible to all stakeholders.

The information is available by the following categories:

  • Total number of participants in the interbank payment systems

  • History of new participants in the interbank payment systems

  • Number of indirect payment service providers (PSPs) by Indirect Access Provider (IAP)

  • Number of PSPs (credit institution or non-credit institution) for each IAP

  • Volume of payments for each IAP by interbank payment system

  • Value of payments for each IAP by interbank payment system

Summary

The number of new direct participants¹ in interbank payment systems² continued to grow, with five new participants in 2022 and a further five in 2023.

The number of indirect access providers has doubled from four to eight since the PSR was created in 2015. While we saw new IAPs³ join the interbank payment systems in 2019, there have been no were no new IAPs since then.

1. Direct participant: For the purposes of this webpage, an organisation is considered to have direct access to a payment system if it can provide payment services because of having an arrangement with the payment system operator – i.e. becoming a direct participant.

2. Interbank payment systems: The UK’s interbank payment systems include CHAPS (operated by the Bank of England), Faster Payments, BACS and the Image Clearing System to pay and clear cheques (all operated by Pay.UK).

3. IAPs provide indirect PSPs access to the payment systems.

Direct access to payment systems

For the purposes of this webpage, PSPs with direct access to a payment system are called direct participants. They settle payments through their own settlement account at the Bank of England, and process payments through a technical connection to the payment system’s central infrastructure.

Source: Compliance reports submitted to us by Pay.UK under our General Direction 2, and the Bank of England’s annual summaries of payment statistics from 2016 to 2023. Note: 2015 data is based on our 2015 Access and governance report.

This graph shows growth in the number of direct participants from 2015 to 2023. All interbank payment systems have seen a steady growth in direct and indirect participants, except for Cheque and Credit/ICS. Faster Payments has seen its direct participants grow from 10 in 2015 to 45 in 2023.

Source: Pay.UK (Bacs, Faster Payments and ICS) and the Bank of England (CHAPS).

In 2022, five new direct participants joined the interbank payment systems, one in BACS and four in Faster Payments. In 2023, a further five new direct participants joined, three in BACS and two in Faster Payments.

Indirect access to payment systems

An IAP is a direct participant in the interbank payment systems that can provide access to other PSPs (‘indirect PSPs’). This gives the indirect PSPs the ability to send and receive payments through the direct participant. There are two main forms of indirect access, agency and non-agency:

  • Agency access means an indirect PSP has its own sort code provided by its IAP.
  • Non-agency access means an indirect PSP uses a sort code shared with other indirect PSPs.

Established IAPs still supply the majority of indirect PSPs, but newer players have continued to gain share since they started providing indirect access services in 2017.

There are currently eight IAPs to the interbank payment systems:

  • Established: Barclays, HSBC, Lloyds, NatWest
  • New IAPs before 2021: ClearBank, Starling, LHV Pank, Modulr

There were no new entrants as IAPs in 2022 or 2023.

Source: PSR annual indirect access information requests.

  • Two of the established IAPs had fewer indirect access customers in 2022 and 2023 than in 2021.
  • One IAP has been the largest provider of indirect access services (by number of PSP customers) since 2015. In 2023 it had 85 new PSP customers compared to the previous year.
  • Between 2018 and 2023, new-entrant IAPs have taken on a growing number of customers. These included smaller PSPs and small money remitters, which historically have had the most difficulty gaining access. Since 2022, the number of PSPs served by new entrants has broadly remained the same at around 350.
  • In 2023, the new-entrant IAPs continued to take on many customers, including smaller PSPs and small money remitters. Two of these new entrant IAPs maintained a similar PSP customer base over the last year, but this follows an increase of around 12% seen in 2022 for the same IAPs. The combined share or two new entrant IPs continues to be higher than one of the more established IAPs. Finally, two new entrant IAPs have both seen growth in the number of PSPs, from zero five years ago, to a combined total of 121 in 2023.

Source: PSR annual indirect access data requests .

Note: New entrants are ClearBank and Starling in 2017, and LHV and Modulr in 2019.

The graph shows the majority of PSPs that are supplied by new entrants are non-credit institutions (i.e. not banks or building societies). While there was a dip in this trend in 2022, the number of PSPs increased in 2023 to 197 which is similar to the number seen in 2021.

Source: PSR annual indirect access information requests.

Note: New entrants are ClearBank and Starling in 2017, and LHV and Modulr in 2019.

The graph shows the annual trend in the proportion of total volume of payments for each IAP by interbank payment system since 2019.

By volume of all payments originating from IAPs, one IAP accounted for most of the payments in BACS and ICS in 2023 (79% and 90% respectively). In CHAPS and Faster Payments, two IAPs accounted for over 75% of the payments originating from indirect PSPs.

New-entrants IAPs’ share of total volume in Faster Payments for 2023 has increased by around 5% compared to 2022. This continues the trend of a year-on-year increase which started in 2019.

Source: PSR annual indirect access information requests.

Note: New entrants are ClearBank and Starling in 2017, and LHV and Modulr in 2019.

The graph shows the proportion of value of payments for each IAP by interbank payment system.

By value, most interbank payment systems had two to three IAPs accounting for most of the payments originating from indirect PSPs – except for CHAPS, where a single IAP made around 60% of the payments every year since 2019.

New entrants had the greatest increase in value for Faster Payments by proportion between 2020 and 2023, with a marginal increase in BACS value by proportion of all BACS payments.

Withdrawals and refusals of access to payment account services

Under Regulation 105(3) of the Payment Services Regulations 2017 (PSRs 2017), if a credit institution refuses a request from a PSP that is not a credit institution for access to payment account services, or withdraws such access, it must notify the FCA. Each notification is automatically forwarded to the PSR. We, with the FCA, review all notifications that we receive for potential issues and/or emerging themes.

The number of withdrawals and refusals have changed as follows in recent years:

  • We received 153 notifications from credit institutions concerning withdrawal of access to payment account services in 2023.
  • This was a 13% reduction from the 175 received in 2022 but remains much higher than the figures for 2020 and 2021 (90 and 92 respectively).
  • We received 135 notifications concerning refusals to grant access to payment account services to a PSP in 2023. This was a marginal 6% increase compared with the 127 received in 2022 and significantly less than the 222 received in 2021.
  • The total number of notifications received has reduced each year from 407 in 2019 to 288 in 2023.

Complaints received

We are the relevant authority for monitoring and enforcing compliance with regulation 104 of the PSRs 2017 and, alongside the FCA, for regulation 105. This includes:

  • Complaints from PSPs about access refusals or withdrawals.
  • Notifications from credit institutions that refuse or withdraw access to payment account services.

We received no complaints in 2022 or 2023.