EG 19.32 The Payment Accounts Regulations 2015

1The Payment Accounts Regulations 2015 (“the PARs”) implemented2 the Payment Accounts Directive. They entitle consumers who hold a payment account (such as a current account) to receive certain information about the fees and charges applied to that account. They also entitle consumers to use a switching service which meets certain minimum standards, if they wish to change their payment account to another provider.

The PARs impose various obligations on payment account providers, such as a duty to disclose certain information when offering a packaged account to a consumer (i.e. the costs and fees of the products or services included in the package). They also introduce an obligation to offer a switching service between payment accounts. The PARs also require credit institutions designated by Her Majesty’s Treasury to provide eligible consumers with access to basic banking services.

As the requirements arise under the PARs and not under the Act, the PARs create a separate monitoring and enforcement regime but apply, or make provision corresponding to, certain aspects of the Act.

The FCA's approach to taking enforcement action under the PARs will reflect its general approach to enforcing the Act, as set out in EG 2. It will seek to exercise its enforcement powers in a manner that is transparent, proportionate and responsive to the issue and consistent with its publicly stated policies. It will also seek to ensure fair treatment of subjects under investigation when exercising its enforcement powers.

Part 1 of Schedule 7 to the PARs applies many of the provisions of the Act in relation to the FCA’s investigation and information-gathering powers to the FCA’s functions under the PARs. The effect of this is to apply the same procedures under the Act for appointing investigators and requiring information when investigating any breaches of the PARs.

For example, the FCA will, if appropriate, notify the subject of the investigation that it has appointed investigators to carry out an investigation and the reasons for the appointment. The FCA's policy in regulatory investigations under the PARs is to use powers to compel information, in the same way as it would in the course of an investigation under the Act.

The RDC is the FCA’s decision maker for some decisions which require warning notices, decision notices or other written notices to be given under the PARs as set out in DEPP 2 Annex 1 and DEPP 2 Annex 2. The RDC will make its decisions following the procedure set out in DEPP 3.2 or, where appropriate, DEPP 3.3 or DEPP 3.4.

For decisions made by executive procedures, the procedures to be followed will be those described in DEPP 4.

Paragraph 1 of Schedule 7 to the PARs applies the procedural provisions of Part 9 of the Act (with some modifications), in respect of matters that can be referred to the Tribunal, and Paragraph 4 of Schedule 7 to the PARs applies Part 26 of the Act to warning notices and decision notices given under the PARs.

When determining whether to take action to impose a penalty or to issue a public censure under the PARs, the FCA’s policy includes having regard to the relevant factors in DEPP 6.2 and DEPP 6.4. When determining the level of financial penalty, the FCA’s policy includes having regard to the relevant principles and factors in DEPP 6.5, DEPP 6.5A, DEPP 6.5D and DEPP 6.7.

As with cases under the Act, the FCA may settle or mediate appropriate cases involving breaches of the PARs to assist it to exercise its functions. DEPP 5, DEPP 6.7 and EG 5 set out information on the FCA’s settlement process and the settlement discount scheme.

The FCA will apply the approach to publicity that is outlined in EG 6.