On 1 July, UK Finance published a voluntary good practice guide to help credit institutions providing access to payment account services and those seeking to access such accounts. The guide recommends that:
- all relevant entities should make sure they have understood which regulatory requirements they should be complying with, depending on the services they offer and whether they are a credit institution, PSP or MSB;
- banks should ensure they embed transparency and clarity into their criteria for providing access to payment services, including where they might be considering exiting a firm. The guide stresses the importance of understanding the applicant’s business;
- PSPs should ensure transparency also in their application process to FCA when applying under the PSRs or EMRs, and how important this is to a credit institution’s decision on whether to work with the PSP;
- MSBs should understand what services they are providing, with whom they should be registered and the relevance of FCA and HMRC requirements;
- consider in particular the following regulatory and other guidance as appropriate:
- JMLSG Part II.1A that sets out industry good practice for credit institutions providing access to payment accounts;
- the Code of Conduct for Indirect Service Providers;
- JMLSG and HMRC guidance on money laundering supervision for MSBs (depending on who the supervisor is – and there is also a section of JMLSG guidance specific to banks providing services to MSBs);
- FCA guidance for firms subject to MLRs – such as its general financial crime prevention guidance, the Financial Crime Guide and its PEP guidance; and
- Regulation 105 of the PSRs and FCA and PSR guidance on it.
The annex to the guide provides examples of questions PSPs might expect to be asked by credit institutions. Credit institutions and PSPs should review their current arrangements in relation to the guidelines.