The UK’s Labour Party has unveiled ambitious plans for the future of financial services, aiming to advance Open Banking, establish standards for AI usage, and promote securities tokenisation and a digital pound if it secures victory in the upcoming election.
With a strong lead in recent polls, the opposition party has expressed concerns about the UK’s lagging position in financial innovation. It proposes a comprehensive strategy and regulatory framework to integrate new technologies into the sector.
Labour is fully aligned with the Bank of England’s efforts on Central Bank Digital Currency (CBDC) and advocates for securities tokenisation, citing its potential to boost liquidity, access to new asset classes, fractional ownership, and improved risk management. “A future Labour government will strive to position the UK as a global leader in tokenisation by clarifying legal frameworks and collaborating with regulators on a balanced, outcome-focused regulatory regime,” according to their plan.
Moreover, Labour seeks to play a pivotal role in shaping international standards for AI applications in financial services. The party is also supporting the Joint Regulatory Oversight Committee’s initiatives for the next phase of Open Banking, focusing on creating a long-term regulatory framework. They emphasize the potential of Open Finance to enhance financial inclusion and promote household savings and investments.
Additionally, a Labour government would request that the Financial Conduct Authority (FCA) and the Payment Systems Regulator (PSR) explore the possibility of establishing a new regulatory sandbox to facilitate product development for those underserved or excluded from the financial system.
For further details, you can access the full plan here.
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