Media Release Payments System Board Update: November 2018 Meeting

At its meeting today, the Payments System Board reviewed the strategic priorities for the Bank's payments policy work. These include: promoting reliable, secure, efficient and low-cost electronic payment services; keeping abreast of new technologies and platforms in payments; putting in place a resolution regime for financial market infrastructures (FMIs); and ensuring that the framework for oversight of foreign-headquartered FMIs remains appropriate.

The Board also discussed a number of other issues, including:

• The Council of Financial Regulators' ongoing review of the regulatory framework for stored-value facilities. The review is aiming to simplify and clarify the regulatory regime for such facilities, ensuring that regulation appropriately protects consumers while minimising barriers to innovation and competition. Council agencies hosted an industry roundtable on the review in early November.
• Innovation in the payments system, including developments in ‘buy now, pay later’ payment services. The Board discussed the growth in this segment of the payments market and the implications of these services for consumers and merchants.
• The New Payments Platform (NPP). While the roll-out of the NPP has been somewhat slower than initially expected, transaction volumes have been growing steadily. Members discussed the fact that a number of the major banks have been slow to make the new system available across a range of channels and to their entire customer base. Members stressed the importance of the major banks continuing to work to enable their customers to make payments that take full advantage of this important new infrastructure. The Board will discuss the results of the Bank's current consultation on NPP functionality and access at its February meeting.
• Some possible options to clarify the operation of the Bank's standards regulating card interchange fees and net compensation to issuers. The Bank will be preparing draft variations to the standards for consultation with stakeholders.
• The Bank's annual assessment of LCH Ltd's SwapClear Service, a UK-based clearing and settlement facility licensed to operate in Australia. This assessment will be published on the Bank's website once the Bank has fulfilled its obligation to make its findings available to overseas counterparts with a supervisory interest in LCH Ltd, and the assessment has been provided formally to the Treasurer and the Australian Securities and Investments Commission.