Payments Regulation and the Systemic Perimeter: Innovate Finance Response to HMT Consultation and Call for Evidence
About Innovate Finance
Innovate Finance is the independent industry body that represents and advances the global FinTech community in the UK. Innovate Finance’s mission is to accelerate the UK's leading role in the financial services sector by directly supporting the next generation of technology-led innovators.
The UK FinTech sector encompasses businesses from seed-stage start-ups to global financial institutions, illustrating the change that is occurring across the financial services industry. Since its inception in the era following the Global Financial Crisis of 2008, FinTech has been synonymous with delivering transparency, innovation and inclusivity to financial services. As well as creating new businesses and new jobs, it has fundamentally changed the way in which consumers and businesses are able to access finance.
Innovate Finance welcomes the opportunity to respond to HM Treasury’s (HMT) consultation and call for evidence on payments regulation and the systemic perimeter. Our response has been informed by engagement with a wide range of members, including challenger banks, non-bank payment service providers, payment gateways, and regulatory technology firms. We are grateful to Baker McKenzie for their invaluable support in preparing this response.
Our members recognise that the complexity and importance of payment chains has increased such that certain actors within payment chains may on their face present similar risks to banks and financial market infrastructures (FMI) subject to existing Bank of England (BoE) supervision and so some level of BoE supervision would be relevant for these providers.
Our members are however concerned by the lack of clarity surrounding the designation framework for actors within payment chains that pose systemic risks. The Kalifa Review of UK FinTech shone a spotlight on FinTechs as a core asset for ‘UK plc’ and reinforced the need for policy and regulation that protects consumers (and wider financial stability) while nurturing FinTechs’ growth and wider competition across financial services markets. Care will therefore need to be taken by HMT in determining where the systemic risk lines lie and which players will fall within scope in order to avoid serious, unintended consequences for competition and innovation, as well as the overall international competitiveness of the UK as a place to do business.
Further, as the BoE is granted supervisory powers over a wider range of firms in the payments space, our members reiterate their strong support for the introduction of proposed secondary objectives for the BoE on growth and international competitiveness. We consider it essential that the BoE’s expanded supervisory activities be conducted in line with these objectives. Additionally, as we recommended in our response to both phases of the Government’s Financial Services Future Regulatory Framework Review (FRF), we would urge the extension of the FRF accountability framework to the BoE in its supervision of a wider payments perimeter.
We unpack the above mentioned and related issues in more detail in response to the consultation questions. We would be pleased to discuss our response in more detail with Treasury colleagues and / or facilitate discussions directly with our members and the wider FinTech ecosystem.
Questions and responses
Chapter 1: Responding to systemic risks within payment chains
Question 1: Do you agree that in line with the principle of ‘same risk, same regulatory outcome’, the Bank of England should have responsibility for supervising systemic actors within payment chains?
Question 2: Do you agree with the government’s approach that the existing architecture of Part 5 of the Banking Act 2009 should be reflected in any expansion in the scope of Bank supervision – with criteria to determine systemic importance, and recognition by the Treasury?
Our members are broadly supportive of the proposal (i) that systemic actors within payment chains could fall under BoE supervision, and (ii) to use the Part 5 Banking Act framework to achieve this (with amendments as necessary to reflect the expansion of the Part 5 framework beyond traditional payment systems). However, any such supervision must be proportionate and appropriate to the sector, and avoid disrupting the competitiveness of the UK FinTech sector and the many benefits it currently delivers to consumers and businesses around the UK.
We consider it vital, therefore, for the Government to stay true to its stated intention of setting a ‘high bar’ for what it considers is a systemic entity, to avoid the creation of new barriers to growth for scaling FinTechs. Furthermore, the Government should give consideration as to how it can avoid creating an unlevel playing field in markets where one or more players are designated by HMT as systemic, but their competitors in those markets are not.
We recognise that the complexity and importance of payment chains has increased such that providers in payment chains may on their face present similar risks to banks and financial market infrastructure subject to existing BoE supervision and so some level of BoE supervision would be relevant for these providers.
However, we consider that the criteria in section 185 of the Banking Act for designation should be tailored to actors within payment chains and articulated clearly, to ensure that there are objective criteria upon which the Treasury will act. The existing criteria in section 185 are specific to the payment systems sector and will need to be updated and amended to reflect the expanded scope (as well as any future-proofing), but any broadening of the criteria should not be too open-ended.
Turning to the substitutability criteria in section 185(2)(c), we take the view that substitutability needs to be considered in the context of the particular market segment in question. Taking merchant acquiring as one example market segment, at first sight it may appear that corporates concentrate their relationships with a single large acquirer or small number of acquirers, but in practice it is common for large enterprises to have relationships with multiple acquirers with the ability to switch seamlessly between them based on performance of the acquirer and the particular market. That switching process may be aided by third-party aggregators who can prompt switching of business based on commercial factors. There are likely to be other nuances in other market segments. It will be important that in applying the substitutability criterion in connection with designation, the Treasury has regard to all relevant factors and business models in the relevant market segment.
Looking at competition issues more broadly, the Treasury should have regard to competition concerns when designing the designation framework. The current framework for recognised payment systems generally deals with a market segment that is more homogenous (with a comparatively small number of large providers) than the wider payments sector to whom the expanded regime could apply. The markets in which other (non-traditional payment system) payment providers operate tend to have a greater number of participants and greater diversity of scale and business models, and in many cases these markets are less mature and are evolving more rapidly. The Treasury will need to take care in determining where the systemic risk line lies, in order to avoid distorting competition within the market, recognising that designation could result in an increase in costs of doing business to the designated party — and expose it to potential restrictions on its activities or trading volumes — when compared with its non-designated competitors.
The regulatory frameworks that apply to payments providers will also vary materially depending on whether, for example, the relevant firm is subject to Prudential Regulation Authority (PRA) supervision under the banking framework or is simply regulated under the Electronic Money Regulations 2011 or the Payment Services Regulations 2017 by the Financial Conduct Authority (FCA) (in some cases, such providers may not be regulated at all). This gives rise to the risk that different payment providers will be at very different stages of readiness to comply with the BoE supervision regime. For example, large incumbent acquirers who are already part of PRA-regulated groups may be better equipped to handle BoE supervision than e-money institutions (EMIs) for whom designation for BoE supervision could represent a "cliff edge."
There is a risk that this regulatory cliff edge could introduce a disincentive to growth for scaling FinTechs once they reach a certain size, which would be at odds with the Government’s Financial Services Future Regulatory Framework Review (FRF) and the Kalifa Review of UK FinTech, both of which attached weight to FinTech growth, innovation and international competitiveness.
One option to address this concern when drafting the legislation is for the Treasury to amend section 185(2) to require explicitly that the Treasury take into account or have regard to the impact on competition in the relevant market segment when taking a decision as to whether to designate. The BoE could also be required under the legislation to take a scaled or proportionate approach to supervision tailored to the provider's business model and consequent systemic risk, as one-size-fits-all approach may not be appropriate for all providers. We think that proportionality and more clarity around what will or may be deemed to constitute systemic risk is needed to avoid unintended consequences on competition.
There is also a general need for clarity around the scope of the entities to be brought within BoE supervision. For example, the following could conceivably be designated:
- a payment provider which itself does not meet the systemic risk criteria but which, in the event of collapse, could threaten the sustainability or stability of a systemic entity;
- a payment provider which does not meet the systemic risk criteria on an isolated basis but which has relationships and dependencies involving multiple entities; and
- an essential or critical associated service provider to a designated payment provider.
On these readings, the universe of firms potentially subject to designation is very wide indeed, including for example acquirers, digital platforms, and banking-as-a-service providers, to name a few. It is also unclear from the consultation whether PRA-regulated firms could be brought within scope of the proposed framework, but we understand that this is a possibility. It is important that there is clarity on the precise scope of entities to be brought within the proposed framework; we consider that the Treasury should set the boundaries of the supervisory perimeter clearly in legislation, with mandated guidance from the BoE to provide clarity of expectations to the sector.
Chapter 2: The scope and regulatory framework of the Banking Act 2009
The effective systemic supervision of the payment chain - Modification through section 206(A)
Question 3: Do you agree with the government’s approach to supervising different types of systemic service provider described above?
Question 4: Do you agree that general IT and technology firms should typically fall within the critical third-party framework instead of the Banking Act, and do you have views on if the current reference to these entities in the Banking Act should be modified, and how?
We are supportive of the proposed oversight powers for the BoE, provided it exercises its supervisory powers in accordance with the Code of Practice it has issued and any additional provisions that are included within the Banking Act to further prescribe and govern the use by the BoE of its powers.
Our response to Chapter 1 sets out some concerns about managing regulatory overlap, particularly where an entity may be subject to FCA supervision and BoE systemic supervision, and we set out further considerations about regulatory overlap in our response below regarding information-gathering. We are also concerned about potential overlap between this proposed regime and the forthcoming critical third-parties regime, particularly when considered in light of our feedback around the lack of clarity regarding scope above. For example, digital ID providers could conceivably fall within scope of both regimes, and it is unclear what the Treasury's intention would be under these circumstances. Would these entities become subject to oversight under both regimes? If so, there is a potential supervisory conflict — while both regimes address issues of systemic stability, the supervisory and oversight mechanisms will work in different ways under different regulators. The Treasury may need to consider a mutual recognition mechanism where there are multiple designations and overlapping supervision. Alternatively, the Treasury should set out precisely how the regimes will fit together, and delineate the perimeters of supervisory responsibility where entities may be subject to overlapping regimes.
Clarifying and enhancing the application of the Banking Act
Question 5: Do you agree with the government’s view that the Bank should have the ability to gather information for the purposes of keeping markets under review from the perspective of understanding systemic risk, in the way proposed above? Are there any features that you consider would be important for this to be an effective and proportionate power?
In principle we agree with the Treasury's proposal, but as noted above, we are concerned about the potential for regulatory overlap and the duplication of requests for information from other financial regulators. We consider that the decision-making around information requests needs to include an element of proportionality: any information requests to firms need to be proportionate, so that firms which are less systemically important or which play a minor role in the payment chain are not overburdened on a regular basis. While the BoE may have a legitimate interest in making information requests, these should be focused on firms they supervise; regulators should be making information requests to firms outside their supervisory remit only if there is no better way of gathering the information. We consider that, where the BoE intends to make information request to a non-supervised firm, it should:
- take care to avoid duplication with similar requests from other regulators;
- ensure that it draws on other regulatory reporting (for example, returns to the FCA) and use gateways as needed rather than sending duplicative requests; and
- ensure requests are proportionate to the BoE's objectives.
Further, information requests from regulators often land on short notice, and can be burdensome on entities, particularly those which are smaller or less accustomed to regulatory oversight. Small players, not only those in the payments sector but across the financial services industry, often find that they are not able to deal with information requests at short notice. Given that under the proposed regime the BoE will effectively be able to request information from a wide range of participants for the purposes of carrying out its functions as long as it is proportionate, it would be helpful to have clarity on how the information request process will work in practice and how proportionality will be considered.
Question 6: Do you agree with the government’s proposal to clarify the Bank’s ability to apply limits where necessary for recognised entities within an expanded regulatory perimeter; to specify the circumstances in which they may be relevant; and views on what those circumstances might be?
We recognise the policy rationale for ensuring that the BoE has the ability to impose limits on recognised entities' business. However, we have concerns with the unintended consequences such a proposal could have on the wider payments sector. We would caution that the current proposals could set an unbalanced precedent with regard to how limits are applied to new payment technologies (such as crypto-assets), which could stifle innovation and competition in the market. Further guidance is needed to clarify the exact circumstances in which such limits would apply, including transparent parameters and thresholds that would need to be met before the BoE could exert their powers. It will be important that the exercise of such powers is subject to a transparent legal framework and that there are provisions included to provide for engagement between the BoE and the recognised entities who are proposed to be or who are subject to a BoE decision in respect of such limits that would enable affected recognised parties to make relevant representations and to appeal any decision to use such powers. In addition, the BoE should be required to exercise these powers proportionately, with due regard to the potential impact of their use on competition and innovation in the relevant market. The exercise of such powers (including the form and likelihood of limits) should be clear and predictable to the market. In conclusion, further consideration on the broader market implications is required before the introduction of any such proposals and we would encourage HMT to continue to consult with industry throughout this process.
Question 7: Do you consider that providing greater clarity as to the nature of the Bank’s supervisory powers would provide greater transparency? If so, do you have views on how this should be provided, for example directly in the legislation, or as a supplementary annex, or in some other form?
We welcome the proposal to provide such clarity. We suggest that the nature of the powers and the purposes for which they can be exercised should be set out in legislation, consistent with the position under the Financial Services and Markets Act 2000 (FSMA) regime for the PRA and FCA. We are neutral at this stage as to whether this is done within Part 5 itself or in an Annex, this is a matter of drafting. We can see that there could also be benefit in a revised version of the Code of Practice to further set out the approach that the BoE intends to take to use of its revised set of statutory powers, and to provide the market with additional guidance.
However, placing the BoE oversight regime on statutory footing also requires a thoughtful change management programme. The mechanics of introducing a codified oversight regime must be carefully managed, to avoid an unnecessary burden on supervised firms and help to manage compliance. We consider that it is particularly important that the BoE, in taking on more far-reaching oversight of a broader set of market actors, must ensure that it is confident in its supervisory capabilities – and, in particular, that it has a nuanced understanding of the markets it is overseeing. This may require additional resourcing and an upskilling programme.
Question 8: Do you agree with the government’s proposed approach to requirements for establishment under the Banking Act and the rationale provided? What are your views on the adequacy of the existing requirements under the Payment Services and Electronic Money Regulations?
We think that flexibility on whether to require a location in the UK is a sensible approach. While it is an open question as to whether the BoE should be able to mandate a UK location or whether this should be built into the HMT recognition order framework, the latter is a less agile solution and we think that the decision should be a supervisory one for the BoE.
However, in allowing for the possibility of mandated establishment, the Treasury and BoE should be mindful that requiring location in the UK could present barriers for the UK payments industry to work with third-party entities outside the UK. We consider that the possibility of mandated location requirements might discourage those firms from seeking business relationships with payment actors in the UK, leading to a detrimental effect on competition and ultimately a loss of choice for the industry of service providers performing functions that could ultimately lead them to be recognised. We agree with the Treasury's suggestion that further guidance on location requirements from the BoE would be beneficial. We would expect that the BoE could make use of cooperation arrangements with other regulators in order to seek to supervise recognised entities located outside the UK and that location requirements would be reserved for cases where there is a compelling reason or reasons as to why the situation of the recognised entity outside the UK impedes its effective supervision.
Managing co-supervisory responsibility
Question 9: Do you support the co-supervisory model proposed between the regulatory authorities, allowing the Bank of England to take primacy for systemic entities for reasons of financial stability? Do you support the principle of the primacy of the FMI SAR for systemic payments entities?
Our members agree that modernising the BoE oversight regime by bringing it into statute (rather than in the current Code of Practice) is beneficial as it places meaningful cooperation and regulatory alignment on a statutory footing and provides more certainty for the industry. It is also sensible to ensure that adequate cooperation arrangements are put in place to avoid issues with regulatory overlap (as discussed in our responses to other questions, regulators should ensure that they draw on shared information between them before introducing duplicative and burdensome information requests on firms).
Our members consider that adopting a more generalist approach of giving primacy to the BoE in respect of FMI matters may have an adverse impact on competition if recognised entities compete with non-recognised entities for example who are subject to the EMI regime.
Chapter 3: The 'Future Regulatory Framework Review': Considerations for the regulation of payments
Question 10: Do you consider that the government should apply the FRF accountability framework to the Bank of England in its supervision of a wider payments perimeter?
As part of the wider response to the Financial Services Future Regulatory Framework Review: Proposals for Reform, Innovate Finance identified to HMT that it considers that all regulators should be bound by the FRF — including objectives, accountability and cost-benefit analysis approach. As explained in that consultation response, the BoE already has the ability to significantly impact the competitiveness of UK challenger banks and its remit and impact on the competitiveness of the FinTech sector will increase where it takes on additional supervisory responsibility for a wider payments perimeter. To avoid fragmented and sectoral approaches, it is essential that the BoE is subject to the FRF as a whole, including the accountability framework.
We also strongly support the introduction of new growth and international competitiveness secondary objectives for the BoE. These secondary objectives will help ensure the UK’s financial services sector is the most trusted and competitive place to do business. Where the BoE is granted supervisory powers over a wider range of firms in the payments space, it is essential that such supervision be carried out in line with these objectives, to avoid unintended outcomes which impact the international competitiveness of the UK's financial services sector.
Adding this secondary objective will also align with the FCA's objectives, which should help to provide greater convergence of purpose where BoE and FCA supervision overlap. Where there is no convergence of purpose, firms who are subject to both FCA and BoE supervision face the risk of conflicting regulatory demands.
We consider that further clarity should be provided on how the BoE will assess the financial stability impacts of UK entities on other jurisdictions, as well as the objectives, criteria and outcomes by which it will ensure non-discrimination on the basis of nationality or location as it relates to other jurisdictions.
Question 11: Do you have views on the government’s proposed approach to aligning the FRF Review with the regulatory landscape for payments?
We are supportive of the proposed approach to align the FRF Review with the regulatory landscape for payments. The opportunity to better tailor requirements applying to the UK market is welcome. However, given the current tight alignment between the UK and EU regimes, and the agile cross-border nature of the payments industry, it is important that deviation from the EU regime is carefully managed and that the UK's position in cross-border payments arrangements like SEPA is not damaged or placed at risk.
We also consider that a nuanced approach should be taken in providing the FCA with a general rulemaking power appropriate for payments and e-money, recognising the specificities of the current regulatory regimes. One of the benefits of the frameworks set out in the Payment Services Regulations 2017 and Electronic Money Regulations 2011 is the ease with which they can be accessed and understood; unlike the FCA Handbook, there is no need to review a number of different sourcebooks with varying applicability to create a complete picture of the regulatory framework. To reduce the compliance burden on payment institutions and EMIs, the Treasury and FCA should ensure that the transition from the current frameworks to FCA rule-making is done in a way that emphasises accessibility and the particular needs of the sector.
Chapter 4: Extending the Senior Managers & Certification Regime
Question 12: Do you think that the Senior Managers & Certification Regime should apply to recognised payments entities within the Bank of England’s regulatory perimeter, including if this is expanded?
Question 13: Do you consider that a SM&CR regime would be beneficial within the FCA’s sphere of supervision, and on what basis?
Our members support high standards of governance within the industry and agree that it would be beneficial to ensure that the BoE is able to require such high standards from recognised entities. We consider that careful thought needs to be given as to the application of the Senior Managers and Certification Regime (SMCR) to payment entities within the BoE's regulatory perimeter. Depending on how the regime is designed, there could be a risk that the burden placed on firms would potentially be disproportionate, given the demands it sets on firms, particularly on new and innovative players who may have been under the Electronic Money Regulations 2011 or Payment Services Regulations 2017 regimes in the past or, possibly, operating without regulatory authorisation. It is important to avoid the resources of firms, particularly newer market participants still going through the scaling process, being unduly diverted away from growth-generating activities. We are also concerned about the application of duplicative regimes for firms already subject to FCA or PRA supervision, particularly given that there is a risk those regimes will be less well-aligned with an SMCR regime to be overseen by the BoE. Any policy proposal would need to account for the need to ensure alignment.
Bringing entities currently outside the scope of BoE supervision into the BoE perimeter is already likely to require an uplift in controls for firms who are recognised under the regime. We consider therefore that careful thought should be given to whether the extension of the SMCR would bring meaningful added benefit without being unduly burdensome for firms. This proposal should therefore, we suggest, be subject to more detailed consideration. We would urge the Treasury to undertake a cost-benefit analysis both across the entire sector and within the subgroup of systemic players, to consider whether the regulatory burden would justify application of the SMCR to all of those entities or more particularly to a targeted subset. The Treasury should be mindful of the potential for firms to face a cliff-edge — for example, an EMI not currently subject to SMCR could find itself facing full BoE supervision as well as SMCR requirements, all of which become effective simultaneously. Any policy proposals in this area should be mindful of the potential compliance burden on such firms.
The question as to whether to apply the SMCR only to recognised entities or also to the remainder of the FCA-regulated payments and e-money sector also requires further consideration. As noted above, applying the SMCR only to systemic firms risks imposing a substantial regulatory burden on top of that imposed by BoE supervision, further distorting the level playing field. On the other hand, we are concerned that blanket application of the SMCR to the entire sector could risk removing some of the competitive advantages that firms in this sector enjoy against larger incumbents such as banks, particularly innovative market entrants. Any policy proposals in this area should take into account these risks and should align with the Government's stated aims of continuing to grow the FinTech sector and stripping away burdensome regulations.
It is clear that operationalisation of the SMCR will need careful management. The BoE may well need to scale up its regulatory arm when the SMCR is introduced and there are foreseeable substantive and procedural issues that could occur, particularly in the early days of application (similar resourcing issues would also be relevant to the FCA in the event of an extension to the wider sector). This is especially the case where the Treasury has emphasised that it intends for the BoE to have discretion and flexibility in applying the SMCR, which as opposed to blanket application creates some uncertainty as to how it would operate. In particular, there may be a period where the BoE is working through an appropriate framework for determining the standard of behaviour on the part of an individual and for any penalties which might be imposed for breaches. There may also be uncertainty as to what constitutes senior management functions (SMFs), under the SMCR, in the context of FMIs.
If proposals move forward, we would urge the Treasury and BoE to operationalise any SMCR application via a phased approach, with tiers of compliance based on the principle of proportionality - examples of such an approach already exist in the sectors subject to the SMCR (for example, by way of the distinction between Core Firms and Enhanced Firms). Further consultation is necessary to fully consider the implications of the regime and its application to the sector.
Chapter 5: Revisiting the Payment Systems Regulator's legislative framework
Question 14: Do you agree with the government’s proposals to simplify the regulatory regime governing access to payment systems?
We consider that there are benefits to be achieved in simplifying the dual regime under the Financial Services (Banking Reform) Act 2013 (FSBRA) and the Payment Services Regulations 2017 to a single regime. In substance the overlapping regimes are relatively similar, with the Payment Systems Regulator’s (PSR) General Direction 2 being similar to the requirements in regulation 103 of the Payment Services Regulations 2017, which means that any combining of the two regimes should be capable of being carried out in a relatively straightforward manner.
Consideration should be given to which provisions of the Payment Services Regulations 2017 are retained and implemented either in FSBRA or through the PSR general directions. For example, access to bank accounts in regulation 105 of the Payment Services Regulations 2017 is invaluable in permitting indirect access to payment accounts for PSPs and to minimise potential negative side effects of de-risking.
Consideration should also be given to the implementation of proportionate access rules for non-designated systems and the impact on the broader access to payment systems if such an obligation on non-designated systems is removed. It is not clear whether under the Treasury's proposal access requirements for non-designated systems would be retained. The consultation notes that the PSR has never exercised its powers in relation to non-designated schemes, but notwithstanding this we would suggest that it is important to have a normative rule requiring such systems to provide access on a POND (Proportionate, Objective and Non-Discriminatory) basis. Additionally, the PSR has provided further clarity on this regime under General Direction 3, and therefore a lack of enforcement should not be taken to mean that there is a lack of regulatory supervision.
Question 15: Do you consider that there is merit in the PSR being able to impose a penalty on designated systems and their participants for ‘misleading information’, e.g. where a person knowingly or recklessly provides the PSR with false or misleading information? Do you have any views on what would be a fair and effective route of appeal?
We consider that this position is not unreasonable and is logical not least given the similar provisions in FSMA applicable to information provided to the PRA and FCA, but care will need to be given as to how any such obligation is drafted and whether guidance is needed to clarify the obligation. Any right to impose penalties should be subject to clear guidelines (for example, by expanding on PSR Guidance in its Approach to Enforcement) on how penalties (if any) will be calculated and what rights of representation, appeal and so on will be granted in respect of such a power. It would seem appropriate for an independent tribunal (such as the Upper Tribunal) to have jurisdiction over appeals in respect of a penalty imposed by the PSR for this type of conduct. It is unclear to us whether any proposed provision here would entail criminal sanctions also (akin to the relevant provisions in s.398 of FSMA) - if so, the appeal route would presumably be via the normal route under criminal appeals procedure.
Question 16: The government would welcome views on any of the issues identified above in relation to the operation of FSBRA.
We agree that a decision by the PSR not to exercise its powers should equally be appealable to the Competition and Markets Authority (CMA). However, consideration needs to be given as to whether a two-month time limit is sufficient for what may be relatively complex cases involving detailed analysis of payment schemes.
We consider that any redress regime would need to be very carefully calibrated as to the nature of the breaches and claims that might enable redress. In particular, given the large number of persons who may be harmed by rule breaches in the sector, a redress exercise could lead to concentration risk and the potential risk of collapse of payment systems. The availability of insurance and other coverage for redress schemes would also need to be considered.
We agree that it is sensible for the PSR to be made explicitly subject to section 84 of the Financial Services Act so that it is formally part of the regulators in scope of the complaints regime.