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Payments & FinTech Lawyer

Volume: 8 Issue: 6
(June 2014)


The UK’s Financial Conduct Authority (FCA) announced on 29 May in a speech made by FCA Chief Executive Martin Wheatley at a Bloomberg conference, its Project Innovate initiative, which will offer compliance guidance to firms working on “positive developments” in financial innovation, and which will use FCA expertise to identify where the “system itself needs to adapt to new technology or broader change - rather than the other way round.” / read more

The Community Financial Services Association of America (CFSA), the payday lenders trade association, and its member company Advance America, filed a lawsuit on 5 June accusing US regulators of adopting guidance that exceeds their statutory authority and using enforcement authority in an arbitrary and capricious manner, as part of Operation Choke Point. / read more

The US Federal Reserve, in collaboration with other banking regulators, announced on 4 June a complete review of laws affecting the financial sector with the goal of identifying particularly burdensome or outdated laws, and asked for comment in response to the first of several public notices. / read more


In May, the European Forum on the Security of Retail Payments published its Final Recommendations on the Security of Payment Account Access. These Recommendations cover so called payment account access providers in which a third party provider accesses a customer’s payment account to provide payment initiation or account information services, as these third party providers will become regulated under the proposed second Payment Services Directive. Steven Francis of Baker & McKenzie analyses the objectives and content of these Recommendations. / read more

On 15 January 2014, Al Franken, the Senate Chairman of the Committee on Privacy, Technology and the Law, sent a letter to Bank of America, Discover, American Express, MasterCard, Visa, Wells Fargo, JP Morgan Chase, Citigroup, and Capital One, stating that ‘Adding security features, such as the chips in “EMV” cards that are used in most other industrialized countries may help prevent the breach of useable cardholder data and make it more difficult to commit payment fraud.’ By Barrie VanBrackle, Partner and Co-Chair of the Global Payments and Consumer Financial Services practice group, Manatt, Phelps & Phillips LLP. / read more

Indonesia has taken notice of the global rise in electronic payment transactions and has developed its own electronic money regulation in response to the increasing importance of electronic payments. The Central Bank of the Republic of Indonesia has issued Bank Indonesia Regulation No. 16/8/PBI/2014, which contains key revisions to the earlier Amendment of Bank Indonesia Regulation No. 11/12/PBI/2009 concerning Electronic Money, as Bramantyo Pratama and Eldo Alwi, of Roosdiono & Partners, explain. / read more

Just two days after being officially appointed as the Chief Executive of the UK’s Financial Conduct Authority (‘FCA’) on 1 April 2014 with responsibility for the consumer credit market, Martin Wheatley wasted no time in announcing that the FCA would be conducting a competition review into the credit card industry. On 6 June 2014, the FCA confirmed it will formally launch a study into the credit card market. This ‘market study,’ scheduled to take place at the end of 2014, has sparked little surprise in the eyes of the UK Cards Association, although market participants will undoubtedly be questioning what the FCA’s agenda is despite Mr Wheatley’s assertion that there are no “pre-determined terms of reference, outcome or agenda.” By Dr. Nathalie Moreno, Partner at Speechly Bircham LLP. / read more

On 1 May, the federal Prepaid Payment Products Regulations (the ‘Regulations’) enacted under the Bank Act, the Cooperative Credit Associations Act, the Insurance Companies Act and the Trust and Loan Companies Act, finally became effective in Canada. Prior to the enactment of the Regulations, there was a complete absence of any prepaid or gift card legislation in Canada that expressly applied to federally regulated institutions. Jacqueline D. Shinfield of Blake, Cassels & Graydon LLP shares her thoughts on the Regulations. / read more

On 8 January 2014, a new Law on Payment Transactions in Montenegro (the ‘Law’) entered into force. The Law is due to become applicable on 9 January 2015. By Milos Curovic, Partner at ODI Law Firm Ilic, Serbia. / read more

In May the UK’s Information Commissioner’s Office (‘ICO’) published its guidance on ‘Protecting personal data in online services,’ which presents eight areas of computer security affecting personal data that have, as the ICO points out, ‘frequently arisen during investigations of data breaches.’ Stephen Bonner and Kirsten Mycroft of KPMG’s Information Protection and Business Resilience team discuss the guidance - and the eight areas highlighted by the ICO - as it applies to financial services. / read more

While many of the pieces of the puzzle are in place, mobile payments are yet to take off as completely as some industry commentators have speculated they should have by now. Alex Preece, UK Managing Director for the mobile wallet solution SEQR, part of global mobile payments company Seamless, outlines why he believes m-payments haven’t reached their potential as yet and explains what in SEQR’s view are the key components to achieving saturation, before analysing the environment for launching an m-payments solution in the UK. / read more

In the US, a number of consumer advocacy groups have raised issues with the fees and fee disclosures for prepaid cards, particularly general purpose reloadable (‘GPR’) cards. GPR cards provide services similar to a debit card, but without the bank account. These cards can be used anywhere the payment brand (Visa, MasterCard) is accepted, and can also be used at ATMs. Positioned as a substitute for bank accounts, many GPR cards also provide bill payment services and even ‘convenience checks.’ By Linda Odom, Counsel at Bryan Cave LLP, Washington DC. / read more

About Payments & FinTech Lawyer

The monthly publication covering legal, regulatory and policy developments relating to the fast-moving payments and FinTech sectors. Key topics include mobile payments, e-money, prepaid and other payment cards, online banking, digital currencies such as Bitcoin, card fraud and other cyber crime, RegTech, robo-advice, P2P lending, and crowdfunding, as well as regulatory regimes such as the Second Payment Services Directive (PSD2), the Payment Accounts Directive, and the Fourth Anti-Money Laundering Directive / read more

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