HM Treasury published the Payments Forward Plan on 26 February 2026. The plan provides the UK payments industry with its first consolidated view of regulatory initiatives through 2028. The Payments Vision Delivery Committee produced the document, bringing together the Bank of England, FCA, PSR and HM Treasury. The roadmap includes a retail payments infrastructure design programme in spring 2026. Enhancements to the Faster Payment System and BACS are scheduled for delivery by end of 2026. HM Treasury will publish a consultation on payment services law, Open Banking, and stablecoin payments in Q2 2026.
The structural merger of the PSR into the FCA remains the centrepiece of the overhaul. HM Treasury launched a formal consultation on the consolidation in September 2025. The two regulators are already coordinating through joint leadership appointments and a shared Memorandum of Understanding. Primary legislation to dissolve the PSR board is targeted for end of 2026. The High Court rejected a legal challenge by Visa, Mastercard and Revolut on 15 January 2026. The ruling upheld the PSR's power to impose cross-border interchange fee caps on UK-EEA transactions. Those interchange fees had risen from 0.2% for debit and 0.3% for credit to 1.15% and 1.50% respectively after Brexit.
Consumer-facing rules are tightening in parallel. The Payment Services and Payment Accounts (Contract Termination) Regulations 2025 take effect on 28 April 2026. PSPs must give at least 90 days' notice before terminating a consumer's framework contract, increased from the previous two months. They must also provide sufficiently detailed and specific reasons for any termination. The regulations respond to the 2023 debanking controversy that prompted an FCA review of account closure practices. Only contracts entered into on or after 28 April 2026 fall within scope.
The PSR's card scheme and processing fee market review compounds the regulatory burden. The final report found that Visa and Mastercard increased core scheme and processing fees to acquirers by at least 25% since 2017. These increases cost UK businesses at least £170 million extra per year. Remedies including improved transparency and pricing governance requirements are being implemented through regulatory directions. For UK payment service providers, the convergence of structural regulatory change, new consumer protections, and fee interventions creates the broadest concurrent compliance challenge since the PSR began operating in 2015.