Government pushes Bank of England to innovate on payments and digital currencies
The Bank of England will be tracked on its progress on UK payments regulation after it was handed a new objective by ministers. The central bank will be given a new secondary objective to support innovation in payment systems and new forms of digital currencies alongside its main goals of financial stability. The Treasury is [...]
The Bank of England has received a new objective to support innovation in payment systems and digital currencies, alongside its primary goal of financial stability. This secondary aim will be implemented through amendments to the Financial Services and Markets Bill, set to be scrutinized in the House of Lords in September. The Bank will be required to report on this objective annually.
City Minister Lucy Rigby emphasized the importance of innovation in payments and digital finance for the UK to remain a global leader in financial services. However, progress in the payments sector has been criticized for being sluggish and more of a "reshuffle than a reform." Critics argue the overhaul, originally promised by the Labour government, has not lived up to expectations.
The Payments Association, an industry body, has called for the Bank of England to have veto rights over the City watchdog, the Financial Conduct Authority. Labour has previously abolished the Payment Systems Regulator (PSR) in a bid to drive growth, with the body now expected to be consolidated into the FCA by the first quarter of 2027, though critics say this change has not led to any practical differences.
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