As our latest Payments Markets Report shows, the 48 billion payments made in the UK touch everyone’s lives, supporting customer experiences and delivering value to businesses. 

There is also a huge amount of innovation taking place within money and payments. For example, industry came together through the UK Regulated Liability Network Experimentation Phase to explore the value of tokenised commercial bank money.

As these new technologies develop, the industry will continue to innovate and invest in our payments infrastructure. This investment will underpin greater resilience and also unlock new capabilities that have the potential to further enhance customer experiences and deliver tangible business benefits.

But the industry is facing challenges. Last year UK Finance surveyed its payment members in responding to the Future of Payments Review. We found that over 90 per cent of change budget was being spent on mandatory regulatory changes. This creates a congested regulatory landscape, with multiple and uncoordinated major infrastructure initiatives and policy developments. This ultimately impacts what the industry is able to do in terms of developing innovative consumer and market-led solutions. 

The industry needs clarity on how different infrastructure requirements will work alongside each other. We therefore strongly welcome the Bank of England’s leadership in delivering an ambitious agenda for UK payments. The discussion paper they published today highlights a number of key issues that need to be addressed to support further innovation and help bring new capabilities like tokenisation to life. We are ready and willing to respond to the call to action from Governor Andrew Bailey.

We need a vision for UK payments that delivers enhanced customer outcomes and enables industry to properly prioritise and structure the delivery roadmap. We also want one regulatory voice that can provide strategic decision making.

Some of the key outcomes we want to see include:

1. Delivering Customer Value and Protection: convenient, swift payments are essential for businesses and consumers. By embracing digital solutions, we can meet these expectations and enhance customer experiences. Within this we also need robust safeguards that protect consumers’ interests, ensuring their trust in the payment ecosystem. Transparency and data standards are our allies in the fight against fraud and economic crime. 

2. Ensuring Resilience, Safety, and Trust: safety, cybersecurity and resilience are non-negotiable. Collaboration between regulators and industry (including system operators and service providers) is crucial to achieving this. We believe that common standards for all forms of regulated money will enhance stability and create a level playing field that benefits both incumbents and newcomers.  

3. Fostering Innovation: the UK’s future marketplaces depend on our ability to deliver new functionalities effectively. We support the Bank’s approach of providing an environment that encourages innovation while maintaining necessary oversight. We must have a level playing field and open, equal access to opportunities for all participants to create a vibrant community of innovators that can work together to shape what a future platform for innovation could deliver.

4. Creating sustainable commercial returns: last but not least, we need to underpin payment initiatives with investability – based on legally certain and sustainable commercial models. To support this, we need more effective governance and stronger delivery and execution capabilities to translate strategic investment decisions into value for consumers, users, and participants.

It is critical that we create a private-public partnership to prioritise initiatives against the outcomes above and identify gaps in capabilities and services that need to be filled. 

We look forward to working with the Bank, other regulators and the government to collectively enhance the UK payments landscape for the benefit of consumers and businesses.