Giving a speech at Mansion House, the UK Chancellor underlined the importance of digitising financial services as the global market becomes increasingly competitive.
It builds on the Financial Services and Markets Act being granted Royal Assent last week, a step which was viewed as key on the roadmap for growth for the UK’s finance sector.
As a result of the act, the provision for an FMI sandbox will be enabled, providing firms with an avenue to test and experiment with distributed ledger technology (DLT) in a regulated environment.
Moreover, it’s a move that can enable the UK to better compete on a global scale, with the European Union having already launched its own DLT pilot regime.
Alisa DiCaprio, Chief Economist at R3 and former Chair of the Fintech Committee at the US Department of Commerce, commented on the speech and the steps taken by the UK government.
DiCaprio stated: “Based on the discussions at Mansion House, we should see the UK government place next-generation technologies at the heart of its strategy to boost financial services.
“One of the recent provisions the financial and technology industry should be particularly excited about is the creation of an FMI sandbox, as outlined by the Financial Services and Markets Act.
“This will allow firms to test and experiment with distributed ledger technologies (DLT) in a regulated environment. With the EU having already launched its DLT pilot regime earlier this year, this will help the UK remain at the forefront of financial innovation against a backdrop of rising international competition – providing the platform for moving towards a more enduring, digital economy.”
David Postings, Chief Executive of UK Finance also welcomed the plans as he stated it underlines the commitment of the UK to being a strong and global competitive financial sector.
“We welcome the plans announced by the Chancellor in his Mansion House speech, alongside his ongoing commitment to ensuring the UK has a strong and globally competitive financial services sector”, said Postings.
“These reforms will help support economic growth and bolster our capital markets by delivering more investment and making it easier for companies to grow and list here in the UK.
“Our approach to regulation and innovation is also key and we look forward to supporting Joe Garner’s review on the future of payments, which builds on our already world-leading payments systems.”