Proposals for a new regulator to cover payments in the UK could threaten progress on important issues for charities, according to the Charity Finance Group.
The Treasury is consulting on plans to introduce a new regulator to replace the Payments Council, the finance industry body that proposed the abolition of cheques.
But the CFG, which has worked closely with the Payments Council on cheques and other issues, said these proposals could threaten progress on digital donations and simple account switching for small charities.
Last month the Treasury published a new consultation, Opening Up UK Payments, which said the government wanted to "establish a new competition-focused, utility-style regulator for retail payment systems".
The Payments Council is working on two issues that will affect charities: a service to make it easier for individuals and small organisations, including charities, to switch bank accounts; and a mobile payment service that will make it easier to make donations through mobile phones and to claim Gift Aid on those donations.
Melora Jezierska, a policy officer at the CFG, said the Payments Council proposal in 2009 to scrap cheques had been "a poorly judged and communicated decision", but since then the council had communicated effectively with the charity sector.
"We’re not in a position to comment meaningfully on the merits of different regulatory regimes," she said. "However, if the government goes ahead with a new regulator that sidelines the Payments Council, we’d hope the new regulator would be able to provide the same level of consultation and engagement with the charity sector that is currently provided by it.
"Some really valuable projects driven by the Payments Council are currently under way, including mobile payments and account switching, and we have been able to feed into them. It would be disappointing if a focus on reforming the governance of payments networks undermined the current pace of innovation."
Adrian Kamellard, chief executive of the Payments Council, said the government proposal failed to recognise the good work done by his organisation.
"Our ability to listen and work alongside consumer and business representatives is vital to ensure customers get the payments they need," he said. "This practical function cannot be replaced by a regulator."