UK Government Slams Bank of England Over Slow Payments Reforms
The UK government is closely monitoring the Bank of England's overhaul of the country's payments system after growing frustrated with its slow pace. The National Payments Vision, which aims to make the UK a world leader in next-generation payments technology, has been criticized for being too sluggish.
Industry insiders say the Treasury's decision to track the central bank's progress on payments and digital currencies by introducing a new secondary objective of innovation reflects 'government frustration' with the pace of the plans. This move is seen as a criticism of Threadneedle Street's approach so far, particularly around stablecoins.
The Bank of England's deputy governor for financial stability, Sarah Breeden, has been tasked with overseeing payments innovation and fintech. However, she has expressed reservations about stablecoin innovation, preferring tokenized deposits instead. This preference is shared by the banking industry, which sees stablecoins as a threat to their core business model.
Adding an objective to the Bank's mandate was seen as 'quite a statement' and amounts to criticism of Threadneedle Street's approach so far. The move has been framed as a way for the government to modernize UK payment regulation and ensure regulators are equipped to support innovation as the sector evolves.