Instant payments to any bank via FPS: amendments to legislation
On 18 June 2019, the draft law aimed at the development of payment services in the Russian Federation passed its second reading in the State Duma. In particular, the document stipulates mandatory participation of banks in the Faster Payments System (FPS).
‘In the modern world, instant payments are already something bigger than merely a bank service, and have been so for quite a long time. Our citizens must be able to transfer funds quickly, conveniently, cheaply and safely, any time and anywhere. The Faster Payments System allows them to do just that, and we are seeing that it is in high demand today: over 730,000 transactions for over 6.5 billion rubles have already been processed. This is why we believe that all banks, especially systemically important ones, must join the FPS. The Bank of Russia plans to set the following time frames for joining the FPS: 1 September 2019 for systemically important banks; 1 September 2020 for banks with a universal licence. This will cover more than 95% of the Russian payments market’, said Olga Skorobogatova First Deputy Governor of the Bank of Russia.
As it was noted earlier, in the second half of 2019, the FPS will allow transferring funds to legal entities, e.g. for goods and services, including using QR codes. The draft law grants the Bank of Russia the authority to establish the procedure of encoding payment details, including with respect to QR codes.
The draft law also gives the Bank of Russia a right to set, if necessary, the upper limit of transfer fees that banks may collect from their clients. This will help prevent setting excessive rates for final consumers.
Moreover, the draft law introduces the terms ‘payment aggregator’ and ‘payment application provider’ and defines the terms of their engagement by banks and the procedures for controlling their activity. Among other things, it is stipulated that the Bank of Russia will maintain lists of these payment market participants and publish such lists on its website.
The above changes are aimed at improving the competition in the financial market, decreasing fees, increasing financial inclusion for Russian nationals and protecting their interests, as well as strengthening the regulator’s control over payment market participants.