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News that the UK’s Payment Systems Regulator (PSR) will continue to operate as an independent entity until at least the end of 2026 means ongoing investigations can continue, and should not negatively affect payments firms.

Appearing before the Treasury Select Committee, David Geale, who now serves as both the FCA’s director of payments and managing director of the PSR, said that although the government’s consultation on the legislation to formally subsume the PSR into the FCA closes next week, he does not expect the legislative changes before late 2026.

“The PSR still exists and we continue to run it as an independent subsidiary of the FCA,” Geale said. 

“We are not sitting still, though. My role is now double-hatting, which brings together the two payments areas, payment systems and payment firms, in one place.”

He added that although the PSR and FCA boards remain separate, integration is already underway across governance, operations and communications.

For example, from October 20, 2025, the PSR’s press office has been incorporated into the FCA’s communications department, as confirmed by an email sent to stakeholders on October 17. 

Geale stressed that the move is “not necessarily about reducing headcount” but about streamlining regulatory oversight and improving efficiency. 

All PSR staff are contractually FCA employees, and work has already begun to align their roles with FCA structures.

“Some people may end up doing something slightly differently,” Geale said. “By virtue of the size and scale of the organisation, one person in the PSR may be doing the equivalent of three jobs in the FCA.”

The PSR’s merger with the FCA was announced in March 2025, as part of the UK government’s plans to simplify the country’s financial regulatory landscape. 

When questioned by the Committee on potential cost savings, Geale said these would likely become visible only once the legislation takes effect.

“We will obviously look very closely at the PSR budget and look to spend it wisely,” he said. “Firms will already see an element of rationalisation, for example, joint meetings with both regulators rather than two separate ones.”

The PSR will remain legally distinct until Parliament passes the necessary legislation.

Ongoing investigations

As of October 2025, the PSR is still pursuing two major market investigations that could have significant ramifications, particularly for the card schemes Visa and Mastercard. 

These focus on card payments, alongside the regulator’s ongoing supervisory work on fraud reimbursement.

The first investigation is the regulator’s market review into card scheme and processing fees, which  in March 2025 that competition in this area is not working well for merchants. 

In April 2025, the PSR launched a , proposing measures such as enhanced financial reporting and transparency obligations for Visa and Mastercard. That consultation remains open as the regulator considers potential interventions to address rising card costs.

The second ongoing review concerns cross-border interchange fees on UK–EEA card-not-present transactions. 

In October 2025, the PSR  a consultation on the methodology for setting potential price caps on these fees, with responses due in November. 

This work follows concerns that interchange costs increased sharply after Brexit and that existing market dynamics offer limited competitive pressure.

In parallel, the PSR is also overseeing implementation of the new authorised push payment (APP) fraud reimbursement regime, which came into force in October 2024. 

The regulator plans to begin reviewing its effectiveness from late 2025. Although this is not a formal market investigation, this work remains a core part of the PSR’s ongoing regulatory agenda and could lead to further interventions, including a lower reimbursement cap.

If the investigations are not concluded before the merger, it will be up to the FCA or the Bank of England to decide whether to continue or wind them down.

However, with the transition already under way, and given the FCA and PSR’s close working relationship the merger’s timeline is unlikely to create significant uncertainty for payments firms.