Date published: 15 July 2024        Closing date: 13 September 2024

Digital wallets represent one of the most significant ways in which big technology firms are playing an important role in the payments landscape. The use of digital wallets has grown rapidly, and it is likely that more than half of UK adults now use one to some extent.

The PSR and the FCA are looking to gather focused information and evidence on:  

  • the range of benefits that digital wallets bring for service users
  • whether there are any features that mean payments don’t work as well as they could for consumers and/or businesses
  • their role in unlocking the potential of account-to-account payments and how they could impact competition between payment systems; and 
  • whether digital wallets could raise any significant competition, consumer protection or market integrity issues, either now or in the future.

Who is this is for?

We want to engage effectively with stakeholders across the payments and wider financial services landscape, including digital wallet and technology providers as well as their service users and other parties with an interest in digital wallets who would like to provide their views. 

Next steps

You can find a full copy of the questions we are looking for input on in section 9 of the Call for Information (CFI).

The CFI is open until 5 pm on Friday 13 September. You can email your responses to FCA-PSR-digitalwallets@psr.org.uk or write to us at: 

Digital wallets CFI
Payments Systems Regulator
12 Endeavour Square 
London E20 1JN

or

Digital wallets CFI
Financial Conduct Authority
12 Endeavour Square 
London E20 1JN
 

If you would like a discussion with the team to provide views, please use the email address above. 

We will publish an update in Q1 2025, once we have considered the stakeholder submissions that we receive.

Background

The PSR and FCA are collaborating in publishing this Call for Information, so that we can understand the opportunities and risks that Digital Wallets’ increasing popularity creates. Many issues are likely to be of interest to both organisations, including those relating to consumer protection. Nevertheless, we operate under distinct regulatory remits and therefore have interests in specific areas:

  • The PSR aims to ensure that the UK’s payment systems work well for everyone that uses them. It has previously examined contactless mobile payments (2018) and is particularly interested in understanding how digital wallets impact consumers’ choice of payment options at checkout. It hopes to examine the implications of digital wallets’ growing role in the payments value chain, and the implications for competition between payment systems and the PSR’s strategic objective of unlocking the potential of account-to-account payments. This work is also in line with the commitments made by the PSR as part of its Annual Plan. 
  • The FCA aims to ensure financial markets work well for individuals, for businesses, and for the medium-to-long-term growth and competitiveness of the UK economy. It examined digital wallets as part of its discussion paper and feedback statement on big tech entry and expansion in retail financial services (2023) and Call for Input on data asymmetry between big tech and firms in financial services (2024). Its regulatory remit gives it a particular interest in issues such as how digital wallets may impact competition in the supply of financial services and the operational resilience and systemic safety of the UK financial services sector.
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