The UK Financial Conduct Authority (FCA), along with the Payments Systems Regulator (PSR), are seeking feedback on the rise and use of digital wallets.
Today, digital wallets are ubiquitous. From smartphone-based applications to hybrid crypto wallets, the use of physical cash is on the decline. Regulators are seeking information on the benefits of digital wallets and their potential risks for users.
According to public officials, it is estimated that more than half of UK adults now use a digital wallet. Apple Pay, Google Pay and PayPal, are said to be the most popular.
David Geale, the PSR’s Managing Director, said that digital wallets are becoming the “go-to payment type” in the UK. At the same time, they are curious about any intrinsic risk with these services.
“Collaboration between regulators and working with industry is crucial to ensure we’re on the front foot to support innovation and competition, making sure everyone benefits from access, protection, and choice in payments. We look forward to hearing views and evidence from a wide range of stakeholders throughout this process.”
FCA Chief Executive Nikhil Rathi said they are seeing a “seismic shift” in how people pay, and they want to ensure that opportunities and benefits are maximized for individuals and businesses while protecting against risk.
The regulators are seeking commentary from interested parties until the 13th of September. A report is expected during the first quarter of 2025.