Statutory instrument 2025/688, the Payment Services and Payment Accounts (Contract Termination) (Amendment) Regulations 2025, comes into force on April 28, 2026. The regulations amend the Payment Services Regulations 2017 by extending the minimum notice period from two months to 90 days for the termination of framework contracts concluded for an indefinite period. The new rules apply only to contracts entered into on or after April 28. Existing contracts remain subject to the prior two-month notice period.
Each termination notice must contain a sufficiently detailed and specific explanation of the reasons for the decision. PSPs are required to inform customers of their right to complain to the Financial Ombudsman Service. Exceptions apply where termination is necessary for financial crime compliance, or where a customer has engaged in violent threats, harassment, or abusive behaviour toward staff.
The regulations arose from the 2023 UK debanking controversy. An FCA review found that account closure decisions routinely lacked adequate explanation. HM Treasury stated the measure protects millions of consumers and businesses against arbitrary account termination.