On 27 August 2026, HM Treasury (HMT) announced that it intends to give the Bank of England (BoE) a new responsibility to support innovation in payment systems and emerging forms of digital money, whilst continuing to prioritise financial stability.
Summary
HMT sets out in its announcement that, at present, the BoE has a primary objective to protect and enhance UK financial stability and that the proposed new secondary innovation objective will be subordinate to this and will not require the Bank to support innovation if doing so would undermine financial stability.
HMT also highlights that the BoE already has a secondary innovation objective for central counterparties (CCPs) and central securities depositories (CSDs), introduced through the Financial Services and Markets Act 2023 and that this reform will extend the same approach to systemic payment systems, including those using digital settlement assets.
Finally, HMT also sets out that it intends to require the BoE to report annually to Parliament on how it was advancing the innovation objective.
Next steps
HMT expects to implement this change through amendments to the Financial Services and Markets Bill, which will be next debated in the House of Lords on 7 and 9 September.
Recent Comments