UK roadmap backs tokenized payments for multi-money system

HM Treasury published an update to the government’s retail payments roadmap on Thursday, calling for tokenization and new forms of digital money to be part of the UK’s core retail payments infrastructure to support a multi-money ecosystem. The Payments Vision Delivery Committee identified programmable payments and tokenized assets as product-level arrangements that could spur payment innovation.

The update expands on the National Payments Vision issued in November and sets out how emerging digital money should interact with existing payment rails. It notes that retail infrastructure will need to handle tokenized payments and other digital money formats alongside traditional bank money to widen payment options for consumers and businesses.

Programmable payments are described in the update as transactions carrying automatic rules or conditions embedded in the payment itself. The document states that enabling programmable features and tokenization at the infrastructure level could help different forms of money coexist and interoperate.

The update arrives as UK regulators move to bring crypto and token-based services into a regulated framework. The Financial Conduct Authority published its crypto regulatory regime earlier this week and set a licensing window that runs from September until Feb. 28, 2027. The broader regime is scheduled to go live on Oct. 25, 2027. Under the proposals, trading venues, custody providers, stablecoin issuers, staking providers and other intermediaries must obtain FCA authorization to operate in the UK.

Policy work in recent months has focused on aligning legal and technical frameworks for tokenized payments. In April the government announced a review of payment services and electronic money rules to create a single regulatory framework covering both traditional and tokenized payments, including stablecoins and tokenized deposits.

The Bank of England has proposed extending operating hours for its core settlement infrastructure toward near-24/7 availability. The central bank said expanded hours would support cross-border settlement and new tokenized settlement models; it is seeking public feedback until July 3 and plans to publish a feedback statement in the summer.

The FCA has noted that tokenization and distributed ledger technology could increase efficiency in fund management and support innovation in asset management. HM Treasury’s update requests industry input on how tokenization should work in UK wholesale markets, indicating further consultations ahead.

The combined timeline and infrastructure planning set out by HM Treasury, the FCA and the Bank of England outline how regulators and market bodies are preparing retail and wholesale markets for digital-money use cases. The update states the aim is a payments system that supports new product types while maintaining operational resilience and consumer safeguards.