Payments System Board

The Payments System Board is a statutory policy board of the Reserve Bank of Australia responsible for the RBA’s payments system policy. Its mandate covers the safety, efficiency and competitiveness of Australia’s payments system and includes oversight responsibilities for clearing and settlement facilities and related financial-market infrastructure.^[1]

Role in Australia’s financial system

The Payments System Board, often abbreviated as the PSB, is the body through which the RBA sets policy for Australia’s payments system. The payments system includes the arrangements, networks, rules and institutions that allow households, businesses, governments and financial institutions to transfer value. In practical terms, this encompasses card payments, account-to-account payments, bulk electronic transfers, high-value interbank payments, cheque settlement, payment-system access arrangements and aspects of clearing and settlement infrastructure used by financial markets.

The Board’s statutory role is distinct from, but closely connected to, the RBA’s broader central banking functions. The RBA conducts monetary policy, issues banknotes, operates key settlement infrastructure and provides banking services to the Australian Government. The Payments System Board focuses specifically on payments system policy and the exercise of the RBA’s payments-related regulatory powers. The RBA describes the Board as responsible for promoting the stability, efficiency and competitiveness of the payments system through the RBA’s policy framework.^[3]

The Board is not a private-sector scheme operator, bank, card network or payments company. It is a public-sector policy and regulatory body within the RBA. Its decisions can affect payment system participants, including banks, card schemes, infrastructure operators, fintech firms, merchants and consumers, but its statutory purpose is framed around the public interest rather than the commercial interests of any participant group.

Legal basis and mandate

The Payments System Board is established under the Reserve Bank Act 1959. The RBA’s public materials state that the Board’s responsibilities and powers are set out across five Acts: the Reserve Bank Act 1959, the Payment Systems (Regulation) Act 1998, the Payment Systems and Netting Act 1998, the Corporations Act 2001 and the Cheques Act 1986.^[2]

Under the Reserve Bank Act, the Board is responsible for determining the RBA’s payments system policy. The RBA states that the Board must exercise this responsibility in a way directed to the greatest advantage of the people of Australia and in a way that best contributes to controlling risk in the financial system, promoting the efficiency of the payments system and promoting competition in the market for payment services, consistent with the overall stability of the financial system.^[2]

The Board also oversees the exercise of RBA powers and functions under the Payment Systems (Regulation) Act 1998 and the Payment Systems and Netting Act 1998. Under the RBA’s Payments System Board Charter, the Board must ensure those functions and powers are performed and exercised in a way that best contributes to controlling financial-system risk, promoting payment-system efficiency and promoting competition in payment services.^[1]

The Board’s mandate also extends to functions under Parts 7.3 and 7.3B of the Corporations Act 2001, which concern the regulation and supervision of financial market infrastructure such as central counterparties and securities settlement facilities. The RBA states that the Board must ensure these powers are exercised in a way that best contributes to the overall stability of the financial system.^[1]

Powers under payments legislation

The Payment Systems (Regulation) Act 1998 is central to the RBA’s payment-system regulatory toolkit. The RBA states that, under this Act, it can designate a payment system as subject to regulation, determine rules for participation, set access regimes, set standards for safety and efficiency, direct participants in a designated system to comply with standards or access regimes, arbitrate disputes where relevant parties wish, and gather information from payment systems or individual participants.^[2]

Designation is an important concept in the Australian framework. According to the RBA, designation does not itself impose regulatory requirements; rather, it is the first step that enables the RBA to use more specific powers, such as setting a standard or access regime for the designated system.^[2] This structure gives the RBA a way to apply regulation selectively where it considers intervention necessary in the public interest.

The Payment Systems and Netting Act 1998 addresses legal certainty in settlement systems. The RBA explains that this Act helps remove uncertainties such as the possible effect of the “zero hour” rule on real-time gross settlement payments and the enforceability of approved multilateral netting arrangements.^[2] Legal certainty is important because modern payment and settlement systems depend on finality: once a payment is settled, participants need confidence that it will not later be unwound because of insolvency or other legal events.

The Cheques Act 1986 is less central than it once was because cheque use in Australia has declined, but it remains part of the legal framework identified by the RBA. The RBA states that amendments to the Cheques Act gave it responsibility to determine that a system for settlement of cheques is a recognised settlement system and provided protections relating to dishonoured cheques settled in such systems.^[2]

Governance and membership

The Board’s membership is specified in the Reserve Bank Act. The RBA states that it comprises the Governor of the RBA, who chairs the Board; one RBA representative appointed by the Governor, who serves as Deputy Chair; one representative of the Australian Prudential Regulation Authority appointed by APRA; and up to five other members appointed by the Treasurer for terms of up to five years.^[2]

The Payments System Board Charter similarly states that the Board includes the Governor, one RBA representative, one APRA representative and up to five Treasurer-appointed members. The Governor is Chair and the RBA representative is Deputy Chair.^[1] This structure combines central-bank expertise, prudential-regulatory input and external non-executive perspectives.

The Board has formal meeting and decision rules. The RBA states that the Board meets once per quarter and that the RBA issues a media release after each meeting setting out key issues considered by the Board.^[2] A quorum is five members. Decisions are made by majority vote of members present and voting, and the person presiding has both a deliberative vote and, if required, a casting vote.^[1]

The Governor’s role is operational as well as governance-related. Under the Charter, the Governor is responsible for the day-to-day management of the RBA, including implementing policies set by the Payments System Board, and must implement those policies consistently with any directions as to implementation provided by the Board.^[1]

Relationship with other RBA boards

The Payments System Board is part of the governance framework of the RBA. Following reforms to the RBA’s board structure, the RBA’s public description distinguishes the Payments System Board from the Monetary Policy Board and the Governance Board. The Payments System Board has responsibility for payments system policy; the Monetary Policy Board has responsibility for monetary policy and financial stability policy other than where that relates to payments system policy; and the Governance Board has responsibility for the RBA’s policy on other matters.^[2]

This division is intended to separate payments policy from interest-rate decisions and broader institutional governance. For example, the Board’s mandate may involve retail payment costs, card payment regulation, access to payment systems, account-to-account payment infrastructure, financial-market infrastructure stability, and settlement finality. These issues are connected to financial stability and competition, but they are not the same as monetary-policy decisions such as setting the Australian cash rate.

The RBA itself can also be a participant in the payments system. It owns and operates the Reserve Bank Information and Transfer System, known as RITS, Australia’s high-value real-time gross settlement system. The RBA’s 2026 Payments System Board Annual Report states that the RBA’s Payments Policy Department acts as overseer of RITS and that the Board retains primary responsibility for approving staff’s periodic assessments of RITS.^[3] This creates governance issues that the Board’s framework must manage, because the RBA can be both operator and overseer of infrastructure.

Clearing and settlement facilities

The Board’s responsibilities are not limited to retail payments. It also has a role in policy and oversight relating to clearing and settlement facilities. These facilities are critical to the functioning of securities and derivatives markets because they support the clearing, settlement and risk management of transactions after trades are executed.

The RBA states that the Board’s responsibilities include policy in relation to clearing and settlement facilities.^[2] The 2026 Payments System Board Annual Report describes these powers and functions as relating to the supervision and crisis resolution of central counterparties and securities settlement facilities, which it identifies as key infrastructure supporting the clearing and settlement of transactions in financial markets.^[3]

This area overlaps with the responsibilities of Australian Securities and Investments Commission, which has complementary regulatory responsibilities for clearing and settlement facilities. The RBA’s annual report states that ASIC and the RBA coordinate their liaison with these facilities and with market participants on topics related to clearing and settlement.^[3]

Interaction with other regulators and institutions

The Payments System Board operates within a broader Australian regulatory architecture. APRA is represented on the Board, reflecting the connection between payment systems and prudential stability. ASIC works with the RBA on clearing and settlement facility supervision. The Australian Competition and Consumer Commission has a competition-law role in payments, especially where industry arrangements involve cooperation among competitors.

The RBA states that the ACCC retains responsibility for competition and access in a payment system unless the RBA designates that system and imposes an access regime or standard; if the RBA does so, the RBA’s requirements are paramount for participants complying with them.^[2] The RBA also states that the RBA and ACCC have a memorandum of understanding covering policy coordination, information sharing and liaison.^[3]

The Board’s work is also relevant to the Council of Financial Regulators, the main coordinating body for Australia’s financial regulators. The RBA states that it works closely with other Council agencies, and where relevant the ACCC, on issues such as financial market infrastructure reforms, crisis management for clearing and settlement facilities, competition in equities clearing and settlement, electronic conveyancing and cybersecurity.^[3]

In retail payments, the Board’s policy environment includes infrastructure and industry entities such as New Payments Platform and Australian Payments Plus. The RBA states that NPP Australia Ltd is a wholly owned subsidiary of Australian Payments Plus and that RBA staff meet regularly with AP+ senior staff about developments in the NPP and other domestic payment infrastructure operated by AP+, including eftpos and BPAY.^[3]

Policy focus and strategic priorities

The Board’s agenda changes over time as payment methods, technology and market structure evolve. Recent RBA reporting identifies issues such as competition in debit cards, merchant card payment costs, surcharging, online card payment security and competition, the development of the NPP, the future of account-to-account payments, cross-border payments and the future of cash as areas of stakeholder engagement.^[3]

In August 2025, the Board endorsed an RBA payments policy strategy for 2025–2027. The RBA stated that the strategy was focused on three strategic objectives, supported by 10 priority initiatives, and was intended to help prioritise the RBA’s efforts to support the evolution of Australia’s payments system in line with the public interest.^[3]

The Board’s policy remit also adapts to changes in legislation. In a February 2024 submission to the Senate Economics Legislation Committee, the RBA described itself as the principal regulator of the Australian payments system, with payments system policy determined by the Payments System Board. The submission supported reforms to the Payment Systems (Regulation) Act 1998, including expansion of the regulatory perimeter to cover entities facilitating or enabling payments, including new entrants.^[4]

These developments reflect a broader shift from a payments system dominated by traditional bank-operated infrastructure toward an ecosystem involving card schemes, digital wallets, real-time account-to-account payments, technology firms, fintech intermediaries, market-infrastructure operators and cross-border networks. The Board’s mandate is framed broadly enough to consider both established systems and emerging payment arrangements where they affect risk, efficiency and competition.

Accountability and transparency

The Payments System Board has statutory reporting obligations. The Payments System Board Charter states that the Board must report to the Minister as soon as practicable after 30 June each year on matters prescribed in section 25M of the Reserve Bank Act and must inform the Government from time to time about its functions, powers and payments system policy.^[1]

The RBA’s 2026 Payments System Board Annual Report states that the annual report is the primary accountability vehicle for the RBA’s payments system responsibilities. It also notes that the House of Representatives Standing Committee on Economics holds twice-yearly public hearings at which the RBA may discuss payments system matters as part of its broader operations.^[3]

The RBA communicates payments policy through media releases, speeches, research publications, its website, industry liaison and international engagement. The RBA states that it publishes a media release after each quarterly Payments System Board meeting, outlining matters discussed and foreshadowing forthcoming documents where relevant.^[3]

The RBA also collects and publishes payments statistics. Its 2026 annual report states that it collects monthly data from financial institutions, card companies and other payments system participants on debit and credit cards, mobile wallets, ATM transactions, merchant fees, bulk electronic transfers, NPP transactions and cheques.^[3] These data support the Board’s assessment of payment trends, market structure and regulatory issues.

International context

The Payments System Board’s role sits within a global central-bank trend toward explicit oversight of payment, clearing and settlement infrastructure. The RBA participates in international forums relevant to this work. Its 2026 annual report states that the RBA is a member of the Bank for International Settlements’ Committee on Payments and Market Infrastructures, a forum for central banks to monitor and analyse developments in payment, clearing and settlement infrastructures and to develop relevant international standards.^[3]

International engagement matters because payment systems and financial market infrastructures are increasingly cross-border. Card schemes, digital wallets, cross-border payment providers, central counterparties and securities settlement systems may involve foreign entities or global standards. The Board’s domestic mandate is Australian, but the systems it oversees or monitors can be connected to international networks, standards and risks.

Significance

The Payments System Board is significant because payments are a core utility of the financial system. Efficient, reliable and competitive payment arrangements reduce transaction costs, support commerce, allow financial institutions to settle obligations and underpin confidence in money. Failures in payment or settlement systems can transmit liquidity and operational stress across the financial system.

The Board’s public-interest mandate gives it a role in balancing several objectives that may not always align. Lower-cost and more open access arrangements can promote competition and innovation, while safety requirements and operational standards can increase resilience but impose compliance costs. The Board’s statutory framework requires it to consider risk control, efficiency, competition and financial stability together rather than treating any one objective in isolation.

For Australian finance, the Board is therefore a central institution in the regulation of payment-system infrastructure and policy. It is closely linked to the RBA, APRA, ASIC, the ACCC, the Treasury, payment schemes, banks, market-infrastructure providers and emerging payments firms. Its work influences how money moves through the Australian economy, how financial-market transactions settle and how payment-system regulation adapts to technological change.