The National Payments Vision ~ A New Chapter for UK Payments?

November 2024
Fintech & Payments

The UK has been one of the leading markets for UK financial services and payments innovation for many years, with the Faster Payments System, which launched in 2008, being one of the first instant payment systems to become popular.

However, despite some key successes, the rate of innovation within UK payments has slowed. A complex domestic regulatory environment, as well as strong innovation in other countries, means the UK has potentially lost its reputation as a leading payments innovator. In this context the Garner Review, formally called the Future of Payments Review, reported in November 2023 that a NPV (National Payments Vision) was required from the Government to chart the UK’s future course within payments.

After a long period of consultation, the UK Treasury finally launched its National Payments Vision on the 14th of November 2024. The question is, however, can the UK once again lead on payments innovation? And what does the National Payments Vision mean for the future of payments, in the UK and beyond?

The National Payments Vision – Key Points

The National Payments Vision sets out several key changes to the way payments and financial services work in the UK, which will have major implications:

  • Changes to the Regulatory Framework: The NPV outlines that regulatory congestion is a genuine concern within the UK market, with the Treasury clarifying the remits of relevant regulators. Of particular note is that the Treasury has designated the FCA (Financial Conduct Authority) as the regulator for Open Banking within the UK.  
  • Development of New Infrastructure: The NPV details that the rate of upgrades, including the delivery of the New Payments Architecture, was not moving quickly enough, and that payment systems operator Pay.UK likely needs to reform in order to deliver in a more effective way. The NPV has set up a new committee, the Payments Vision Delivery Committee, that will see the Payment Systems Regulator and the Bank of England set out an approach to development by Q2 2025.
  • The Scaling of A2A (Account-to-Account) Payments: The NPV contains the ambition that A2A payments are developed as a ubiquitous payment method, for both in-store and online transactions, which will require infrastructure upgrades, plus the regulatory changes mentioned above. This represents a major goal, and a fundamental shift in the way that customers pay for all kinds of goods and services.
  • Changes to the Way Fraud is Handled: The NPV covers how fraud is a major challenge, and emphasises that intelligence sharing between financial institutions is key to improving fraud prevention. It also shares that the UK Government is calling on technology and telecommunications platforms to prevent fraud occurring on their channels. This includes the prominence of scams on Facebook Marketplace, or the use of SMS for fraud attempts. 
  • Continued Exploration of the ‘Digital Pound’: The NPV sets out the Government’s commitment to continuing the design phase of the so called Digital Pound, without committing to a deployment of the system in practice. It also acknowledges that  the introduction of a UK CBDC (Central Bank Digital Currency) would require legislation from the UK Parliament, protecting user privacy.
  • Digital Identity in the UK: The NPV sets out that the Data (Use and Access) Bill is putting digital identity verification services on a solid regulatory footing within the UK, which will be important in delivering future innovation. This includes the creation of a trust framework for digital identity verification services, the registration of approved services and issuance of a ‘trust mark’ for them, and the ability to mandate standards that these services must follow.

Where Does This Leave the UK?

Taken together, these developments represent a major shift in how payments are handled within the UK. The ambition to scale an A2A system for both in-store and online payments will be a significant shift, requiring massive changes in how consumers and merchants operate, the regulations that are in force, how fraud is handled, how third parties process payments, and other considerations.

Alongside this ambition, the NPV is fundamentally practical. It recognises that regulatory congestion is a major concern within the UK market, and that infrastructure upgrades are desperately needed to enable A2A payments. It also recognises that the UK has been a leader in Open Banking, and seeks to capitalise on that. For these reasons, the NPV is likely to be well received by stakeholders in the UK. In particular, making the FCA responsible for regulating Open Banking is a bold move. This can potentially accelerate Open Banking within the UK, which after a promising start has slowed, with regulatory oversight being distributed between different entities and a lack of viable commercial models. The change can accelerate Open Banking development, if the opportunity is used correctly.

However, there is still a lot of work to be done. The NPV does have practical steps, such as the regulatory shifts, but there needs to be much more activity to deliver on its promises. The NPV mentions the challenge of creating software and hardware that can facilitate A2A payments in-store, but this is no more than a brief mention. This is a major task, that should not be underestimated.

Therefore, the jury is still out on the future of payments within the UK. The NPV sets out a commendable agenda and trajectory, but delivering the work that is needed to achieve this will be a monumental task, requiring the participation of many different stakeholders. The future is bright, but will require consistent delivery and significant effort.


Nick Maynard is Juniper Research's VP of Fintech Market Research, and enjoys helping clients to size new market opportunities, set priorities for future growth, and understand their customers through survey projects. He has been interviewed by major news outlets such as CNBC, Coindesk, and the BBC, and has spoken at key industry events including Money 20/20 Europe.

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