BoE speaks on money and payments

Jon Cunliffe (BoE Deputy Governor, Financial Stability) has given a speech on money and payments. Highlights include:

G20 roadmap to improve cross-border payments

Whilst improvements have been made since 2020, there is still a lot of work to be done to meet the targets for 2027. Areas of focus for this next phase include:

• further upgrades to central bank and private sector payment systems;
• implementing the data standards for cross-border ISO 20022 payment messages and developing harmonised standards for APIs;
• facilitating and promoting interlinking of fast payment systems; and
• an action for FATF to update its recommendation on detecting and preventing misuse of wire transfers by terrorists and other criminals.

BoE’s exploration of a ‘Digital Pound’

The joint BoE/HMT consultation on the possibility of introducing a new retail central bank digital currency generated over 50,000 completed responses, which fall into two broad categories:

• the majority expressed general concerns about three issues – privacy, programmability and the decline of cash; and
• the smaller category of responses included detailed comments on the proposed platform model and other key design features.

The BoE aims to publish a comprehensive response to the consultation in the coming months.

Regulation of stablecoins

Building on the recent financial promotion regime expansion to include crypto promotions, Mr Cunliffe explained that there is a strong case for regulating stablecoins to protect investors, prevent their use for illicit finance and to ensure market integrity. BoE expects very soon to issue a discussion paper outlining its proposed regulatory regime for retail payment systems using stablecoins.