Tata Consultancy Services (TCS) has emerged as a top contender to take over the administration of Britain’s Faster Payments Service, a critical component of the UK’s economic infrastructure responsible for processing over 90% of salaries, 70% of household bills, and almost all state benefit payments, according to a SkyNews report. The procurement process, surrounded by secrecy, is currently under regulatory review, with a formal decision pending.
While the selection process is ongoing, sources close to the matter indicate that TCS has edged ahead of the incumbent Vocalink, owned by Mastercard. TCS’s potential involvement in managing the Faster Payments Service, distinct from Tata Steel, has raised attention due to the controversy surrounding Tata Steel’s plan to cut 3,000 jobs in south Wales as it transitions to greener electric arc furnaces, supported by a £500 million government grant, the report said.
Vision for Payments
The decision on appointing a new operator for the Faster Payments Service awaits the government’s release of a revised sector strategy known as Vision for Payments, expected later this year, it said. The Payment Systems Regulator, in collaboration with the Bank of England, is involved in reviewing proposals as part of its role as the regulator of the UK’s payment systems. However, the process is currently on hold pending the Vision for Payments announcement, the report said.
Last year, a review highlighted gaps in consumer protection exposed by the surge in faster payments activity in the UK. Garner also pointed out the current system’s failure to deliver a seamless experience for consumers. The value of the contract for the next operator of the Faster Payments Service remains undisclosed, it said.
A spokesperson for Pay.UK, the entity overseeing the procurement process, stated, “Pay.UK is conducting a comprehensive and competitive procurement process for the [New Payments Architecture]. We have carefully examined prospective vendors and considered all relevant data, competition, and regulatory requirements. We are now going through the necessary regulatory non-objection and assurance process. We will not comment further while the process is ongoing,” according to the report
Mastercard, which owns Vocalink, mentioned that it has not received communication from Pay.UK on the matter, and the bid process remains in the regulatory non-object phase. Mastercard acquired Vocalink in 2016 in a deal worth approximately £700 million. Vocalink has played crucial roles in systems like BACS, facilitating direct debit payments, and LINK, the UK cash machine network.