The UK government will give the Bank of England a new secondary objective to drive digital innovation in payments regulation, HM Treasury announced.
The innovation mandate will sit below the Bank’s primary financial stability objective and applies to its oversight of systemic payment systems, including those using digital settlement assets such as stablecoins. The Bank already has an equivalent secondary objective for central counterparties and central securities depositories, introduced through the Financial Services and Markets Act 2023.
City Minister Lucy Rigby said, “Developments in digital payments technology, including tokenisation and DLT, have the potential to transform financial markets across the globe. Whilst financial stability will always remain the Bank’s primary objective, this secondary objective will support the Bank to continue to drive innovation in payments and digital finance, ensuring that the UK remains a global leader in financial services.”
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