Financial Services SpeedRead 6 July 2021

1. The UK published draft Agreement between the UK and Switzerland on mutual recognition of their authorised economic operator programmes

On 1 July 2021, the Secretary of State for Foreign, Commonwealth and Development Affairs presented an Agreement (which is currently not in force) before Parliament considering the Trade Agreement between the United Kingdom and the Swiss Confederation. The Agreement affirms that security and safety, and the facilitation of the international trade supply chain can be significantly enhanced through mutual recognition of their respective Programmes for Authorised Economic Operators (AEO). The Agreement does not materially cover financial services.

We provide a brief background on AEO below:

• Businesses can apply for AEO safety and security (AEO-S) status. According to the agreement, this status is an internationally recognised quality mark with the objective of ensuring the security of the international supply chain.
• The purpose of the UK-Swiss AEO Mutual Recognition Agreement (AEO MRA) is to replicate and provide continuity for UK and Swiss AEO businesses who were previously receiving benefits under the EU-Switzerland Customs Security Agreement.
• According to the agreement, if a business holds AEO-S status, they will be able to benefit from AEO MRAs that the UK has in place with partner customs authorities.
• An AEO MRA allows businesses that hold AEO-S status in the UK, to be recognised as ‘trusted business partners’, allowing them to access the benefits of this status when trading with those countries, such as experiencing smoother and faster customs clearance processes at those countries borders.

2. HM Treasury publishes a new chapter for financial services

On 1 July 2021, the Chancellor delivered a speech which set plans to 'make the UK the world’s most advanced financial services hub and help the UK project its values abroad'.

In his speech, the Chancellor announced the UK Governments aim to become a world leader in Green Finance and have a sector at the forefront of technology and Innovation. These plans include:

• requiring companies, pension schemes, financial services firms and their investment products to report on the impact they are having on the climate and environment - as well as the risks and opportunities facing their business. The government confirmed its intention to legislate to deliver this and will set out its approach to green finance regulation ahead of COP26;
• the Government will work with the FCA to create a new sustainable investment label - a quality stamp - so that retail consumers can clearly compare the impacts and sustainability of their investments for the first time;
• new laws to make sure people only need to travel a reasonable distance to pay in or take out cash, and that the FCA has the powers that it needs to hold firms to account to meet these requirements; and
• a consultations on reforms to the regulation of wholesale capital markets and a fundamental review of the prospectus regime following recommendations in Lord Hill’s listings review.

3. UK and Singapore start negotiations on digital trade agreement

On 27 June 2021, the UK and Singapore started negotiations on a digital trade agreement (DTA). According to the UK Department of International Trade, the DTA could remove barriers to digital trade and enable UK exporters to expand into high-tech markets. The DTA does not materially cover financial services. The negotiations will focus on:

• securing open digital markets for exporters, allowing them to expand into new markets and sell traditional products in new ways;
• ensuring free and trusted cross-border data flows, while upholding high standards of personal data protection;
• cutting red tape for UK businesses by promoting digital trading systems such as digital customs and border procedures that will save time and money when exporting;
• upholding consumer rights and protecting businesses' valuable intellectual property such as source code and cryptography; and
• deepening cooperation on future growth sectors like fintech and lawtech, while working to strengthen our collective cybersecurity capabilities.

4. Speech by Nikhil Rathi (CEO of the FCA): "Building a Regulatory Environment for the Future"

On 22 June 2021, Nikhil Rathi (CEO of the FCA) delivered a speech on the FCA's plans to build an effective regulatory environment post-Brexit. The key messages of his speech are summarised below.

• Meeting the needs of UK markets: leaving the EU allows the FCA to tailor its rules to better suit UK markets, while ensuring appropriate safeguards and upholding high standards. Areas most in need of reform include market structure, the operation of the transparency regime, the regulation of commodity derivatives markets and access to market data. In relation to primary markets, the FCA is in the process of consulting on a set of clear conditions where it will not look to suspend the listing of SPACs.
• Setting the bar high at the gateway: the FCA will rigorously review all firms seeking UK authorisation. In particular, the FCA plans to tackle financial crime at the gateway through the registration of crypto-asset firms.
• Playing our part in international regulatory discussions: the FCA is working with other regulators to deepen existing partnerships and forge new ones. In particular, the FCA is currently working negotiating cross-border financial services agreements with Switzerland and Singapore.
• Climate-related financial disclosures and ESG: the FCA is proposing to extend its climate-related financial disclosure requirements to issuers of standard listed equity shares. Moreover, the FCA is seeking stakeholder's views on selected ESG topics in UK capital markets and proposing new disclosure requirements. See entry ‎5 below for details.

5. FCA publish Primary Market Bulletin listing applicants with cannabis-related businesses

On 2 July 2021, the FCA set out its proposed approach in a new Primary Market Technical Note listing applicants with cannabis-related businesses. The FCA confirmed that these companies will be included on the FCA's Knowledge Base.
The proposed technical note confirms that the FCA will not admit the securities of a company with any recreational cannabis business, directly or indirectly, to the Official List. This is because the possession and supply of cannabis for recreational purposes are criminal offences in the UK.

Therefore, the FCA confirmed that proceeds from those activities, even where generated in jurisdictions where it is legal, are criminal property under the Proceeds of Crime Act 2002 (PoCA).

Companies carrying on cannabis-related activities such as the development, production and sale of cannabis-based medicinal products (CBMPs) and products containing cannabidiol (CBD) may be admitted to the Official List provided that the criteria for listing are satisfied and we are satisfied that their business does not give rise to any money laundering offence under PoCA.

6. HM Treasury publishes UK Prospectus Regime Review

On 1 July 2021, HM Treasury published a consultation paper on the "UK Prospectus Regime Review".

The proposals include:

• Scope of UK public offering rules: (i) retaining the prohibition on public offers of securities but introducing new exemptions for companies with (or applying to have) securities admitted to trading on regulated markets; (ii) changing what constitutes “the public” in a public offering of securities to ensure that fundraises to existing stakeholders in the company are not subject to the public offers of securities; and (iii) retaining the 150 person threshold and Qualified Investor exemptions;

• Admission to trading: remove the prohibition on admission to trading on regulated markets without first having published an approved prospectus. The FCA to also have discretion to determine whether or not a prospectus is required. The FCA could use this discretion not to require a UK prospectus where a prospectus is published in another country;

• Junior markets: excluding a company’s own shareholders from the definition of the public - together with two other options: (i) for companies admitted to MTFs, exempting them from the restriction on public offering rules. It would only apply where the issuer has itself requested admission of the securities to trading on the MTF; and (ii) recognising AIM admission documents as a form of prospectus; and

• Public offerings by overseas companies: there are three possible options (i) maintaining the status quo of permitting overseas companies to make offers into the UK provided an FCA-approved prospectus is reviewed and approved; (ii) allowing companies with securities listed on a non-UK stock market to extend an offer of those securities to the public in the UK, on the basis of offering documents prepared in accordance with the rules of that market’s jurisdiction; and (iii) not to provide an equivalent right to make a public offer in the UK under the revised regime. This would not constrain the UK government from including such a mechanism on a reciprocal basis in any Mutual Recognition Arrangement in the future;
  The consultation closes on 24 September.

7. HM Treasury publishes Wholesale Markets Review

On 1 July 2021, HM Treasury published a consultation paper on the Wholesale Markets Review.

The consultation proposes the following:

• clarifying the regulatory perimeter for trading venues or amending the existing definition through FCA guidance.

The breadth of the current definition has created ambiguity particularly for unregulated technology firms which provide arrangements that permit investment firms to exchange trading interest and execute transactions with their clients in a way that challenges the definition of a multilateral system.

The current definition is also ambiguous about whether brokers arranging transactions over the phone without operating a central mechanism to match client orders, need to be registered as a trading venue.

• clarifying the conditions governing trading venues and SIs including whether to retain the MTF matched principal trading restriction, and the restriction on operating an SI within the same legal entity as an OTF;
• eliminating requirements limiting firms' ability to execute transactions where they can get the best outcomes for investors, for example, by removing the share trading obligation and double volume cap;
• amending the transparency regime for fixed income and derivatives markets and ensure instruments are subject to transparency requirements; and
• a comprehensive review of the commodities regime to ensure market activity is not unnecessarily restricted, while ensuring markets function efficiently.

The consultation closes on 24 September 2021.

8. HM Treasury publish The Markets in Financial Instruments (Capital Markets) (Amendment) regulations 2021

On 30 June 2021, HM Treasury published the Markets in Financial Instruments (Capital Markets (Amendment) Regulation 2021 (SI 2021.774). The SI removes both RTS 27 and RTS 28 requirements (the FCA will need to remove similar rules from its Handbook), portfolio management notices, and pre-contractual cost and charge notifications for wholesale clients. Moreover, it makes electronic communication with wholesale clients the default mode of communication.

The changes come into force 26th July 2021.

9. FCA publishes consultation paper on proposed decision under the Benchmark Regulation for 6 sterling and yen LIBOR settings

On 24 June 2021, the FCA published a consultation paper (CP 21/19) on its proposal to use its article 23D(2) powers introduced through amendments to the Benchmarks Regulation under the Financial Services Act 2021. The FCA proposes to require the administrator of LIBOR, ICE Benchmark Administration, to change the way 1-month, 3-month and 6-month sterling and Japanese yen LIBOR settings are determined after 2021 (i.e. "the 6 LIBOR settings") to secure an orderly wind-down. The FCA's requirement would be conditional on any designation of the 6 LIBOR settings as article 23A benchmarks taking effect immediately after end-2021.

10. HMT issues a call for evidence on the UK Securitisation Regulation

On 24 June 2021, HM Treasury issued a call for evidence regarding the UK's Securitisation Regulation (this is the 'onshored' version of the EU Securitisation Regulation, the UKSR).

Article 46 of the UKSR included a requirement for HM Treasury to review the functioning of the UKSR and lay a report in Parliament by 1 January 2022. The report is required to assess the following areas:

• the effects of the UKSR – including the introduction of the simple, transparent and standardised ("STS") framework – on the functioning of the securitisation market, the contribution of securitisation to the real economy (in particular on access to credit for SMEs and investments), and the interconnectedness between financial institutions and the stability of the financial sector;
• risk retention modalities (the prescribed methods for meeting the risk retention requirement);
• disclosures related to private securitisations;
• an STS equivalence regime;
• ESG disclosures;
• the third-party verification regime; and
• limited licensed banks.

The EU is also due to review its securitisation framework in 2021 and HM Treasury views Brexit as providing an opportunity to tailor regulations to suit UK markets (as stated by the Chancellor in his November 2020 speech). The respective UK and EU reviews may well lead to further divergence on securitisation requirements for issuers, sponsors and investors in future.

Responses to the HMT call for evidence are due by 2 September 2021.

11. HM Treasury confirms it will introduce a regulatory gateway for firms wishing to approve financial promotions

On 22 June 2021, HM Treasury issued a response to its July 2020 consultation on the regulatory framework for approval of financial promotions. In its response, the Government confirms that it will be introducing a gateway for the approval of unauthorised persons' financial promotions. Under this regime, all new and existing authorised firms will be prohibited from approving the financial promotions of unauthorised persons, to be implemented via a requirement on their permission – the Financial Promotion Requirement. Authorised firms wishing to approve financial promotions will have to apply to the FCA to have the prohibition removed either entirely (allowing them to approve all types of financial promotions), or partially (allowing them to approve certain types of financial promotions). For further information, please see our briefing here.

12. FCA publishes consultation papers on climate-related disclosures for standard-listed companies and asset managers

On 22 June 2022, the FCA published two consultation papers on climate-related disclosures. The consultations set out plans for mandatory climate-related disclosures across the UK economy by 2025, using the framework created by the Taskforce on Climate-Related Financial Disclosures (TCFD).

CP 21/17

In CP 21/17, the FCA sets out plans for climate-related disclosures in respect of asset managers, life insurers and FCA-regulated pension providers. In summary, the FCA is proposing:

• entity-level disclosure requirements: for firms to make annual website disclosures on how they take climate-related risks and opportunities into account in managing or administering assets on behalf of their clients and consumers. The contents would need to be consistent with the TCFD's recommendations; and

• product or portfolio-level disclosure requirements: for firms to make annual disclosures on their website and in certain client communications regarding the individual products or portfolio management services offered. The disclosures would consist of a set of core, mandatory carbon emissions and carbon intensity metrics and scenario analysis. Firms would need to include disclosures on governance, strategy and risk management where these are thought to be materially different to disclosures made at entity level.

The FCA is proposing, in addition, that firms should provide data on the underlying holdings of their products to clients that request it to satisfy their own climate-related financial reporting obligations.

CP 21/18

In CP 21/18, the FCA sets out its plans to extend the application of its existing TCFD-aligned disclosure requirements (set out in Listing Rule (LR) 9.8.6R(8)) to issuers of standard listed equity shares (as included in LR 14), excluding standard listed investment entities and shell companies. Under the proposed rule, the FCA would require in-scope standard listed companies to include a statement in their annual financial report disclosures including the following:

• whether they have made disclosures consistent with the TCFD's recommendations and recommended disclosures in their annual financial report;
• where they have not made disclosures consistent with some or all of the TCFD's recommendations and/or recommended disclosures, an explanation of why, and a description of any steps they are taking or plan to take to be able to make consistent disclosures in the future; and
• where in their annual financial report (or other relevant document) the various disclosures can be found.

The FCA is proposing that the new rule take effect for accounting periods beginning on or after 1 January 2022, so that the first annual financial reports issued in compliance with the proposed rule would be published in 2023.

13. PRA publishes consultation on designating investment firms (CP15/21)

On 5 July 2021, the PRA published a consultation on "Designating investment firms" (CP15/21).

The key proposals are as follows:

• to increase the base capital resources requirement for PRA-designated investment firms from €730,000 to £750,000 to be in line with the FCA’s minimum requirement for firms doing the same type of business under the IFPR. This requirement has not been revised since 1993, despite inflation;
• the PRA RAO currently provides the PRA with power to designate investment firms that deal in investments as principal, with a base capital resources requirement of €730,000 ( i.e. IFPRU 730k firms). This will be amended to £750,000 as stated above; and
• the proposed update would mean that certain additional firms (including ‘local’ firms and exempt matched principal firms) that are currently classed as ‘limited licence’ or ‘limited activity’ by the FCA will in due course be able to, in principle, be designated for prudential supervision by the PRA. Therefore, all investment firms that deal in investments as principal, which are not specifically exempt, would become eligible for potential designation by the PRA.

14. FCA publishes policy statement to implement Proposed Investment Firm Prudential Regime

On 29 June 2021, the FCA issued a policy statement (PS 21/6) summarising the feedback it received in response to its consultation paper (CP 20/24) on the first set of proposals to introduce the UK Investment Firms Prudential Regime (IFPR). The IFPR is a new prudential regime for UK firms authorised under the MiFID. The FCA expect the IFPR to take effect from 1 January 2022.«

15. HM Treasury publishes consultation response on implementation of the Investment Firms Prudential Regime and Basel 3 standards

On 24 June 2021, HM Treasury published a consultation response on the implementation of the Investment Firms Prudential Regime and Basel 3 standards, confirming, amongst other things, that HM Treasury:

• has decided to remove FCA-regulated EUR 730,000 ICR firms from the scope of the UK resolution regime. Additional firms brought into the scope of the £750,000 capital requirement will also not be within scope of the UK resolution regime;
• intends to present the secondary legislation required to revoke the specific provisions in the UK Capital Requirements Regulation (575/2013) (UK CRR) shortly (except in relation to leverage), and to pass a second statutory instrument, before the end of 2021, which makes amendments to legislation that are needed as a consequence of these revocations, and revokes provisions relating to leverage;
• considers that applying the equivalence provision for exposures to units or shares in a third country collective investment undertaking contained in article 132 of the UK CRR would not be a proportionate method for addressing the prudential risks arising from UK banks' investments in overseas funds. It has decided to remove the equivalence provision;
• has decided to implement the Fundamental Review of the Trading Book (FRTB) reporting requirements alongside FRTB revisions to Pillar 1 capital requirements (i.e. as part of Basel 3.1 and not from 1 January 2022) owing to concerns about implementation costs; and
• will not depart from its proposed approach of amending the Financial Services and Markets Act (PRA-Regulated Activities) Order 2013 (SI 2013/556) to remove reference to the €730,000 initial capital requirement, which will become obsolete. This would not result in these firms being designated for prudential supervision by the PRA.

16. FCA: Multi-firm review: Review of host Authorised Fund Management firms

On 30 June 2021, the FCA published a webpage setting out the findings of its multi-firm review into Authorised Fund Managers (AFMs) that delegate investment management to third parties outside of their corporate group. They are often referred to as host AFMs or host 'Authorised Corporate Directors'.

From Q4 2019 to Q4 2020, the FCA visited a sample of host AFMs to review the effectiveness of their governance, controls and monitoring. The FCA found weaknesses in governance structures, conflicts of interest management and operational controls.

The FCA's key findings by area are set out below.

• Due diligence over delegated third-party investment managers and funds: overall, firms performed poorly in this area. While some firms did follow a set process, others relied on more informal conversations to assess and understand proposals. The FCA is concerned that firms did not gather the level of detailed knowledge required, through their due diligence, to adequately understand the funds for which they would have responsibility.
• Oversight of delegated third-party investment managers and funds: a number of firms displayed poor oversight of delegated third-party investment managers. The FCA also observed a lack of in-depth understanding of investment management activities and investment strategies by key people undertaking delegated investment manager oversight.
• Governance and oversight: in a number of the AFMs were unable to provide evidence of robust governance procedures. Minutes of board meetings and discussions did not show effective challenge by independent non-executive directors. In some cases, it appeared that decisions had been taken outside formal meetings with little or no discussion. The FCA also found that although most firms had a framework for managing conflicts of interest, not all appeared effective.
• Financial resources: several firms operate at a relatively low operating margins and appear to lack appropriate investment in systems, controls and people to execute their role as host AFM effectively. The review also found that a number of firms could not demonstrate how they used capital risk assessments in their ongoing operations and decision-making.

The FCA confirmed that it will provide written feedback to all firms in the review and a small number will be required to undertake section 166 Skilled Person reports to improve compliance. The FCA also stated that it is conducting further work to identify whether changes are needed to the regulatory framework that firms operate under and this could include rule changes.

17. FCA publishes Dear CEO letter to Retail Banks

On 29 June 2021, the FCA published a Dear CEO letter to retail banks to share common control failings identified in anti-money laundering frameworks of retail banks financial crime and controls.

The common weaknesses identified by the FCA in areas of firms financial crime systems and controls framework include:

• Governance and oversight: firms often blur responsibilities between the first line business roles and second line compliance roles. This can be seen where compliance departments undertake first line activities e.g. completing all due diligence checks or all aspects of customer risk assessments. According to the FCA, the implications of this are that first line employees often do not fully understand the financial crime risk faced by the firm, impacting their ability to identify and tackle potentially suspicious activity.
• Risk assessment: the quality of business-wide risk assessment (BWRA) have been reviewed and ranked as 'poor'. In some instances, firms had insufficient detail on the financial crime risks to which the business was exposed to. Moreover, the FCA also identified common issues regarding customer risk assessments (CRA) which according to the FCA were too generic to cover different types of risk exposures and there were significant discrepancies in how the rationale for specific risk rating were arrived at and recorded by firms.
• Due diligence: the FCA identified instances where customer due diligence (CDD) measures were not adequately performed or recorded. In some instances, firms did not seek information on the purpose and intended nature of a customer relationship (where appropriate) and assessments of that information.

• Transaction monitoring: for branches and subsidiaries of overseas firms, the FCA often noticed group-led transaction monitoring solutions which had not been calibrated appropriately for business activities and underlying customer base of the UK regulated entity, or implement additional risk-based transaction monitoring measures.
• Suspicious activity reporting: there were a few instances where the process by which firms' employees can raise internal SARs to the nominated officer were unclear, not well documented or not understood by staff. In one instance, a customer may have been alerted to money laundering concerns due to investigators not being appropriately trained in how to investigate potential suspicious activity.

18. EU Commission consultation on the Distance Marketing of Consumer Financial Services Directive

On 22 June 2021, the EU Commission issued a consultation on the Distance Marketing of Consumer Financial Services Directive (DMD). This follows an evaluation of the DMD, the outcome of which was published in November 2020. The Commission notes that the retail finance sectors have undergone many changes since the coming into force of the DMD in 2002, with new products and actors available on the market and new sales channels being used. It also notes changes to the EU financial services legislative framework and that many of aspects of the DMD have been taken over by sectoral legislation that has been adopted afterwards.

A May 2021 impact assessment issued by the Commission set out possible policy options such as:

• repealing the DMD: the impact statement looks at a full repeal given the emergence of other EU legislation and the fact that the pre-contractual information provisions in the DMD and the right to withdrawal in the DMD do not fully address "the digital dimension";
• repealing the DMD but moving the still relevant parts, once modernised, under another horizontal legislation: this would involve retaining aspects of the DMD such as information, the right of withdrawal, but modernising and introducing them into other legislation (such as the Consumer Rights Directive or the revised Consumer Credit Directive); and
• comprehensive revision of the DMD: this would involve keeping aspects of the DMD that serve as a "safety net" and introducing other features (e.g. rules on personalised advertising, on robo-advice, on the use of digital identities).
  The consultation closes on 28 September 2021 and proposals are expected to be published in the first quarter of 2022.

19. HM Treasury published Consultation paper discussing the access to cash

On 1 July 2021, HM Treasury published a consultation to protect access to cash and ensure that the UK's cash infrastructure is sustainable for the long term. The consultation stems from the Governments "Access to Cash: Call for Evidence" (Call for Evidence) publication in October 2020, which sought views from interested parties on the key considerations for maintaining a sustainable network of retail cash infrastructure in the UK while supporting the use of cash by people and businesses over time.

The Government proposes to:

• make the FCA the lead regulator for the retail cash system and therefore responsibilities for the monitoring and enforcement of cash access requirements and reporting to HM Treasury on these responsibilities at appropriate intervals;
• introduce geographic access requirements to withdrawal and deposit facilities, including free-to-use ATMs within 1km of the next nearest free-to-use source of cash, protecting free access to cash on high streets, and commissioning new ATMs where there is an unmet need for cash access.
• designate firms on whom legislative and regulatory cash access requirements can be imposed. The Government announced possible requirements which will be targeted at the largest payment account providers.

On the same day, PSR published their second Annual Review of Specific Direction 8 (SD8), which is designed to make sure LINK does all it can to fulfil its commitment to maintain the broad geographical spread of free-to-use) ATMs.

20. Competition and Markets Authority warns banks over banking transaction history breaches

On 22 June 2021, the Competition and Market Authority (CMA) warned Monzo Bank, Bank of Ireland, NatWest Group and Virgin Money in relation banking transaction history breaches.

Banks have an obligation under the Retail Banking Market Investigation Order 2017 to send customers a current transaction history within 40 days of a customer or small business closing their current account. Transaction histories must be sent to at least 95% of such customers within ten working days.

The CMA has warned that if the banks breach the order again, it can take further action by issuing legally binding Directions. These could include banks having to introduce specific training or carrying out annual compliance audits to prevent breaches from happening in the future.«

21. Collaboration between Pay.UK and the Bank of England on ISO 20022 payment messages

In 2018, the Bank and Pay.UK published a format for a new, common messaging standard for payments made via the UK's high value and retail payments systems, known as the Common Credit Message (CCM). The Bank of England (BoE) has since continued to develop it collaboration with Pay.UK and states that it remains committed to ensuring alignment on both a technical and policy perspective on standards between the two infrastructures. This seeks to ensure that the BoE maximises the benefits realised with the implementation of ISO 20022.

On 24 June 2024, the BoE announced that throughout 2021 and beyond, its key areas of collaboration will include:

• working with UK Finance and the Payments Standards Strategy Group on the strategic direction for the governance of payment standards in the UK;
• working closely with industry to develop meaningful use cases and end-to-end journeys for utilising enhanced data to address existing challenges, such as Authorised Push Payment;
• providing to industry a CHAPS and NPA schema comparison view against the original pacs.008 CMM, outlining where the schemas align and diverge; and
• further developing the requirements with industry for how the key enhanced data would be consistently implemented and used to unlock benefits, and ensure an aligned approach. 

22. Speech by Victoria Cleland (Executive Director for Banking, Payments and Innovation at the Bank of England): "A New Dawn for Payments"

On 21 June 2021, Victoria Cleland (Executive Director for Banking, Payments and Innovation at the Bank of England (BoE)) delivered a speech at City Week 2021, setting out key priorities for the BoE in terms of the payments landscape. The key points arising from Ms Cleland's speech are as follows:

• the BoE will transition to enhanced ISO 20022 messaging in February 2023 and the UK is at a critical and exciting stage in its first ISO 20022 migration;
• any work on central bank digital currency, as set out in the BoE's discussion paper, would need to co-exist with core payments infrastructure, such as the RTGS;
• Real Time Gross Settlement (RTGS) has played a central role and has received a number of technical and policy upgrades over the years;
• effective industry engagement in relation to RTGS is important (examples include the Strategic Advisory Forum; and the Senior Sponsors' Body);
• ISO 20022 will bring many benefits to the UK's payment systems and can help with compliance and regulation (in terms of providing better data to aid fraud detection and other financial crime);
• the BoE will mandate the sending of enhanced data, beginning with Purpose Codes and Legal Entity Identifiers within certain CHAPS messages from Spring 2024; and
• the BoE is working on delivering key aspects of the October 2020 roadmap on enhanced cross-border payments published by the FSB and the CPMI.