HM Treasury announced a package of measures, launched during Fintech Week in London, to modernise the UK’s payments services regulatory framework and align it with rapid innovation in tokenised payments, stablecoins, Open Banking and AI-enabled payments. The package also appoints Chris Woolard CBE as Wholesale Digital Markets Champion and allocates an additional GBP 1 million for the Centre for Finance, Innovation and Technology from April. The reforms would integrate the regulation of payment services and electronic money into the UK’s core financial services regulatory approach, creating a single framework covering both traditional and tokenised payments, including stablecoins and tokenised deposits. The plan includes regulating stablecoins used for payments when issued under a forthcoming UK regulated activity for stablecoin issuance, exploring how regulation should adapt to payments conducted by AI agents, and giving the Financial Conduct Authority new powers to regulate the future of Open Banking, including supporting the development of Open Banking payments within commercial schemes. HM Treasury also plans legislation to reduce administrative burdens for firms seeking to provide stablecoin payments and published its response to its consultation on bringing the Payments Systems Regulator into the FCA. HM Treasury said it will soon publish a consultation on reforming payment services and electronic money regulation and will bring forward legislation as part of the package. Woolard will be tasked with providing market leadership and coordinating industry implementation of the Wholesale Financial Markets Digital Strategy, focused on developing a tokenised wholesale financial markets ecosystem.

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