The Payments Council, working with the payments industry, committed to exploring how options for richer data may feed into their ambition to deliver a world class payments system for the UK.
Richer data could make it possible to provide additional reference information with an electronic payment. This could help businesses better reconcile payments and improve cash management, and help customers know where they stand by giving them greater clarity on their finances.
As the largest single user of the UK’s payment systems, the Government is supportive of the industry exploring plans to incorporate richer data into payment systems. On this basis, the payment industry is in discussion with a number of government departments to explore feasibility including: the Department for Work and Pensions (DWP); HM Revenue & Customs (HMRC); and the Department of Business, Innovation and Skills (BIS) with Cabinet Office leading on commercial arrangements.
DWP has already identified that richer data could help them more quickly reconcile information it receives in administering the benefits system. It could also offer benefits to individual claimants, making their reporting of financial data to DWP easier.
This announcement comes as the new Payment Systems Regulator (PSR) is preparing to become fully operational on 1 April 2015. The PSR has objectives to ensure that the operation of payment systems promotes competition, innovation and the interests of service-users.
Should there prove to be a feasible and commercial proposal for richer data, the industry will consider bringing this forward for review by the PSR’s proposed Payments Strategy Forum as part of its initial work programme for a world class payment system.
Andrea Leadsom, Economic Secretary to the Treasury, said:
"The development of payment systems in the interests of all users is central to improving competition and outcomes for customers; this is exactly why we created the new Payment Systems Regulator. Richer data offers some exciting avenues for innovation, and it is right that government and the industry works together to explore the case for developing these.
"If there proves to be a viable proposition, this will be an issue for the PSR to consider as it takes control of the strategy-setting process for the payments industry."
Lord Freud, Minister for Welfare Reform, said:
"The payments industry’s commitment to work towards a richer data capability is one that will be welcomed across Government and will benefit all who use the UK’s payments systems.
"Richer Data means that anyone making a payment could add much more information about a transaction, not just the current 18 character limit. This could bring a wide range of benefits, from allowing automatic invoice reconciliation for business to enabling individuals to see more information with payments they receive. Richer data could also lower the cost to the taxpayer of administering benefits and reduce losses from error and fraud."
Francis Maude, Minister for the Cabinet Office, said:
"As part of this Government’s long term economic plan we are supporting businesses across the country. This is a welcome announcement from the Payments Council, who recognise the enormous potential for the use of richer data in meeting this ambition. The Cabinet Office will work closely with departments on the early discussions on the potential benefits and costs."