Interbank Tokenised Deposits Debut in the UK

October 2026

Fintech & Payments

Lorien Carter

Senior Research Analyst

On September 27th 2026, the first live customer transactions were completed by British banks using tokenised deposits. Tokenised deposits are a digital representation of an existing fiat balance held at a licensed bank; recorded on a distributed ledger. The underlying deposit remains on the bank’s balance sheet, and is therefore covered by existing regulatory protection. The platform used to conduct the transactions is built by Quant, a technology infrastructure platform. 

The transactions were made through the Great British Tokenised Deposit Initiative, which is convened by UK Finance and includes seven major high street banks: Barclays, Nationwide, NatWest, Santander, Monzo, Lloyds Banking Group, and HSBC UK. This represents the first instance of tokenised deposits being issued across different institutions, rather than being inside the same lender’s systems. 

The Transactions: Improving Mortgage Payments and the Marketplace

Currently, the area of remortgages and deposits is one that is plagued with considerable friction in the UK. As high-value transactions, they often take a few business days to clear, and may be subject to manual checks and delayed further. 

Source: Juniper Research

The use cases demonstrated by the test revolved around mortgages. Two remortgage completions were carried out, where the deposit funds were locked until their release at completion of the required checks. This reduces the manual processes required to complete the property transaction, and reduces transaction time. Another potential benefit is that the blockchain is an immutable ledger that can record title deeds and history of ownership. Furthermore, borrowers can keep earning interest on the money until the deal is closed.

The tokenised deposits were used to lock funds in until completion, and once conditions were met, they were released automatically. This is possible because of the programmability capabilities inherent within blockchain technology. Programmable payments use smart contracts to automate money transfers based on predefined rules, which are coded to self-execute once the conditions have been met.

Further Use Cases: The Marketplace

The other transaction completed in the UK was in regard to the marketplace. A consumer marketplace transaction involved funds locked into the buyer account, which are only released upon the condition of confirmation that the goods have been received.

However, there is the question of how effective these payment innovations are when existing marketplaces already have this capability. For example, the second-hand clothes marketplace Vinted takes the funds from the buyer when they purchase the item, holds the funds in a third-party account, and releases it when the courier confirms package delivery, and the buyer confirms that the item is as described. In terms of user experience, this is not functionally different from what they would experience if a smart contract was used, and the payment logic was embedded directly within the commercial bank money. The return on investing in a new payments mechanism to end up with effectively the same result is low.

Source: Vinted

Instead of consumer marketplaces, tokenised deposits may become more prevalent within the B2B supply chain. In these scenarios, the considerable amounts of liquidity locked up in supply payments is high; making gains in the speed of settlement valuable. As tokenised settlement makes atomic swaps possible, the counterparty risk on high-value transactions is reduced.

Tokenised Deposits Around the World

This initiative in the UK joins similar ones found worldwide. For example, six major banks in Canada are exploring the same model at an interbank level, while US banks are developing tokenised deposit networks. Separately, SWIFT is testing infrastructure designed to connect banks and provide ledgers for tokenised deposits that are available to settle payments in real-time. This became operational on the 9th July 2026, when their blockchain-based ledger became available for 17 banks over six continents to pilot live transactions.