Bank of England Payments Forward Plan 2026: A Consolidated Regulatory Pipeline for the Payments Ecosystem
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The first publication of its kind: a single document presenting the full regulatory horizon for UK payments, from enhanced safeguarding to digital gilt settlement.
Context:
In February 2026, the Payment Systems Regulator (PSR), FCA, and Bank of England jointly published the Payments Forward Plan, a new document presenting a consolidated view of the regulatory pipeline across the UK payments ecosystem and its intended outcomes, designed to help payments firms plan and innovate in a complex, multi-regulator environment.
The Payments Forward Plan is the product of a deliberate effort to improve regulatory communication following longstanding industry feedback that the payments sector faces an unusually fragmented regulatory landscape with the Bank of England overseeing systemic payment systems and financial market infrastructure, the FCA regulating payment service providers and electronic money institutions, and the PSR overseeing competition and access in designated payment systems.
The plan is published against a backdrop of significant structural change: the PSR's functions are being progressively consolidated into the FCA ahead of legislation; contactless payment limit technical standards were updated in March 2026; and the Bank of England's RTGS (Real Time Gross Settlement) renewal programme and the Digital Securities Sandbox are both operational, creating a path toward tokenised settlement in UK financial markets.
Rules and Guidelines:
The Payments Forward Plan sets out the regulatory pipeline across five themes: (i) consumer and business protection, covering safeguarding, Consumer Duty, and APP fraud reimbursement; (ii) financial crime, covering money laundering, sanctions compliance, and fraud prevention; (iii) innovation and competition, covering open banking, stablecoins, Variable Recurring Payments (VRPs), and the Future Entity for open banking; (iv) operational resilience, covering PS26/2 incident reporting (March 2027 effective date), the Strong Customer Authentication (SCA) technical standards updates, and the Bank's RTGS renewal; and (v) digital assets, covering the cryptoasset regulatory regime (final rules expected 2026), the Digital Securities Sandbox, and the Digital Gilt Instrument (DIGIT) pilot.
The Plan is not a new regulatory requirement. It is a coordination and communication tool, but it has practical significance because it enables firms to identify dependencies between different regulatory workstreams and sequence their implementation programmes accordingly. The FCA has been explicit that firms operating across multiple payment services categories must read the Payments Forward Plan alongside the FCA Payments Regulatory Priorities report.
The Plan also confirms that the consolidation of the PSR's functions into the FCA is proceeding ahead of legislation, meaning that firms should be prepared for a single regulatory interlocutor for most payment services regulation in the medium term.
Businesses Affected:
All participants in UK payment systems: banks, building societies, payment institutions, electronic money institutions, payment system operators, and fintech firms.
Digital assets and tokenised payments firms, including those developing stablecoin and tokenised deposit products within the FCA Sandbox.
Open banking participants, including account information service providers, payment initiation service providers, and Variable Recurring Payment providers.
Firms operating within the Bank of England's RTGS ecosystem and those preparing for the Digital Securities Sandbox.
Next Steps:
Use the Payments Forward Plan as a regulatory horizon scanning tool, map your firm's compliance programme against the pipeline and identify where implementation timelines converge.
Ensure implementation of the Safeguarding Supplementary Regime (May 2026) and PS26/2 incident reporting (March 2027) are resourced as separate, parallel workstreams rather than sequential projects.
Engage with the open banking Future Entity establishment process. Workshops are planned for summer and autumn 2026; early participation will give firms influence over the long-term governance framework.
Monitor the Digital Securities Sandbox and DIGIT pilot for signals about the future of tokenised settlement in UK markets, which will affect treasury operations, custodian services, and settlement infrastructure.
Where the PSR consolidation into the FCA creates changes to supervisory contacts or reporting channels, plan proactively for the transition rather than waiting for legislation.
Source | HM Treasury | Payments Forward Plan
