The UK Treasury has set out plans to bring payment services, stablecoins, and tokenized deposits under one regulatory framework. It announced the proposal during Fintech Week in London as part of a wider push to modernize the country’s payments system. The plan would create a new issuance regime for payment stablecoins, widen the Financial Conduct Authority’s remit, and support fintech coordination with new public funding.
Under the proposal, the government would place traditional payment services, stablecoins used for payments, and tokenized deposits inside a single framework. In turn, officials aim to update rules around a payments system facing rapid technological change.
The Treasury said stablecoins used for payments would fall under a new issuance regime. At the same time, the plan would expand the FCA’s remit, especially in relation to open banking.
The statement also said regulatory changes for payment activity carried out by AI agents remain possible. Alongside that, the government signaled it wants to reduce administrative requirements for firms that offer stablecoin payment services.
During the announcement, Economic Secretary to the Treasury Lucy Rigby said fintech is a British success story and said the government wants the sector to keep its competitive edge. She linked the measures to growth and faster development across the industry.
The Treasury also committed £1 million, or about $1.35 million, for the Centre for Finance, Innovation and Technology. The funding starts in April 2026 and aims to support collaboration across the sector.
In addition, the government confirmed the appointment of Chris Woolard CBE as Wholesale Digital Markets Champion. Woolard, now a partner at EY and a former interim FCA chief executive, will lead work on tokenized wholesale financial systems.
Woolard said UK fintech benefits from a regulator that engages with innovation early so firms can test, learn, and scale responsibly. His remarks came as the government framed the new measures as part of a broader payments strategy.
The Treasury said digital assets and blockchain technologies could reshape how consumers and businesses use financial services. It also said the UK’s existing financial infrastructure and fintech ecosystem give the country a base for further expansion.
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Looking ahead, the government said it wants the UK to become the world’s center of choice for financial services investment over the next ten years.
Anthony Yeung, chief commercial officer at CoinCover, said the government’s focus on stablecoins and tokenization points in the right direction for UK financial services institutions. Still, he said, regulation alone cannot carry adoption.
He said operational factors remain central, including custody, key management, and system resilience. He added that trust in digital asset systems depends on reliable access, control mechanisms, and recovery processes in real-world conditions.
As the UK moves toward implementation, the framework’s impact will depend on how policy design fits with those operational layers. That issue will matter as institutions decide whether to expand digital asset activity beyond trial programs.
The UK Treasury plans a single framework for payment services, stablecoins, and tokenized deposits while expanding FCA oversight and backing fintech collaboration. The proposal also points to lighter admin rules, AI-related payment oversight, and stronger support for digital asset development as institutions weigh broader adoption.