British regulators are investigating the increasing use of digital payments offered by Big Tech firms, scrutinizing potential competition, consumer protection, and market integrity concerns. The Financial Conduct Authority (FCA) and the Payment Systems Regulator (PSR) are soliciting views on the benefits and risks associated with digital wallets, such as Apple Pay, Google Pay, and PayPal.
Their assessment will focus on the impact these services have on competition and the variety of payment options available at checkout.
According to the regulators, digital wallets are now used by more than half of UK adults, marking them as “an increasingly important touchpoint” between Big Tech companies and UK consumers. David Geale, the PSR’s managing director, acknowledged the growing popularity of digital wallets, noting that while they present exciting opportunities, potential risks must also be considered.
Nikhil Rathi, the FCA’s chief executive, described the rise of digital wallets as a “seismic shift” in payment methods, emphasizing the need to maximize opportunities while safeguarding against the risks posed by this technology.
This review by British regulators aligns with broader efforts by authorities in Europe and the United States to examine Big Tech’s expanding role in financial services. Last year, the U.S. consumer watchdog proposed regulations for payments and smartphone wallets, sparking criticism from the industry, Reuters news report said.
The British regulators’ review builds on their previous work regarding contactless mobile payments and the influence of Big Tech in financial services. An update on their findings concerning Big Tech and digital wallets is expected by the first quarter of 2025.
