JROC sets out next steps to help UK open banking grow
Summary
The Joint Regulatory Oversight Committee (JROC) has set out an ambitious programme of work to take forward recommendations for the next phase of open banking in the UK. This involves setting up dedicated workstreams to action six key themes and priorities.
To support this, the JROC has launched two new working groups, on variable recurring payments (VRP) and the future open banking entity. It has also tasked Open Banking Limited (OBL) with leading and coordinating workstreams on four of its other key themes.
JROC co-chairs PSR managing director Chris Hemsley and FCA executive director Sheldon Mills said ‘Now we have a roadmap in place to deliver the next phase of open banking, it’s vital we work collaboratively and at pace to progress its key priorities. These workstreams will ensure the right foundations are in place for open banking to grow safely and sustainably.
Greater use of VRP will allow consumers and businesses to make a wider range of payments more conveniently and efficiently. This could include utilities or charity donations where the amounts paid can vary each time. VRP use is currently limited to individuals moving money between accounts (‘sweeping’). The VRP working group will develop a blueprint for the phased roll-out of non-sweeping VRP by the end of September 2023.
A planned transition from the Open Banking Implementation Entity (OBIE) to a future open banking entity will build on progress made to date. The Future Entity working group will consider the design of the future entity, including its role, structure, funding, and implementation. The working group will report to the JROC by the end of September and the JROC will publish its views in an update towards the end of 2023.
Both working groups will be established by the end of June 2023. The VRP working group will be chaired by the PSR, and the Future Entity working group by the FCA.
Under the JROC’s oversight, the OBL will lead and coordinate on four key themes:
· Levelling up availability and performance
· Mitigating the risks of financial crime
· Developing proposals for dispute processes
· Improving information flows to third-party providers (TPPs) and end users.