Latest global payments news

The Financial Conduct Authority has sent letters to more than 290 payment companies saying that these firms are not adequately protecting consumers from financial risks, thus potentially harming the integrity of the entire financial system. The letter says common failings include not safeguarding consumers' money if the firm becomes insolvent, inadequate reconciliation and a lack of a procedure to identify which funds must be safeguarded to protect customers. The FCA added that there's a general lack of liquidity risk management for most of the country's digital payment companies. Other risks include money laundering and fraud. The letter is more of a warning than a direct act, though the FCA did say it would take "more assertive action" soon, including sanctions or "removal" of firms that do not meet standards. The FCA did not provide a backdrop for its letter, though it comes amid the crisis at Silicon Valley Bank, Signature Bank, Silvergate Bank, Credit Suisse and others. This context has drawn attention to payment issues such as payroll and supply chain billing, which could expose payment companies that cannot process transactions due to exposure to the troubled banks. —John Adams

The Bank of Indonesia plans to discourage the use of international payment card networks like Visa and Mastercard, urging local businesses to rely instead on debit and credit cards issued by domestic payment platforms, Republic World reports. The move comes after Indonesia's president, Joko Widodo's recent warning to banking officials about risks from geopolitical conflicts like Moscow's war against Ukraine. After Russia's invasion last year, the U.S. imposed sanctions on the use of Visa and Mastercard in Russia, causing disruptions in payment processes, Widodo reportedly said. Indonesia's central bank vowed to push for greater reliance on domestic payment cards, in hopes of promoting stability and lower card-processing costs, according to the report. —Kate Fitzgerald