UK: Treasury consultation: a special administration regime for payment and electronic money institutions

HM Treasury has, today, published a consultation paper in respect of a proposal to introduce a special administration regime for payment institutions (PIs) and electronic money institutions (EMIs): see here (pdf). To quote directly from the consultation paper (paras. 1.4 and 1.5):

.... there is evidence that the existing insolvency process for PIs and EMIs is suboptimal with regards to consumers. Recent administration cases involving PIs and EMIs have taken years to resolve in some cases, with customers left without access to their money for prolonged periods and receiving reduced monies after the cost of distribution. In six recent cases of PIs and EMIs in insolvency proceedings (of which three started in 2018), only one has so far returned funds to customers.  The Government is therefore proposing to introduce changes that will help protect customers in the event of a PI or EMI being put into insolvency. As these changes can be delivered relatively quickly and could mitigate harms from any future insolvencies, the Government believes it is appropriate to progress these changes before the conclusion of the Payments Landscape Review is published".