Other initiatives to guide new and firms that are innovative

Other initiatives to guide new and firms that are innovative

Lowering barriers to expansion and entry

Tandem Bank (authorised in November 2015) is a digital-only retail bank that will operate a personal finance guide which compares financial products offered by both Tandem as well as its competitors. Other innovative banks are in the pipeline for authorisation.

Other initiatives to aid new and innovative firms

The lender of England supports innovation in financial services through its strive to promote innovative research and data analytics in central banking, and improving the ability of innovative firms to access Bank of England facilities. The financial institution has additionally embraced new technology in the provision of UK banknotes.

Research and analytics

The lender launched its One Bank Research Agenda initiative in February 2015 to try to understand and develop innovative best practice in central banking, taking into account technological, institutional, social and environmental change.

It aims to facilitate dialogue that is open the financial institution therefore the research community to support innovation and inform the Bank’s work. The lender has put up a study Hub division to simply help drive this forward and developed a new online blog, Bank Underground.

The initiative covers research questions on five broad themes: policy frameworks and interactions; evaluating regulation, resolution and market structures; policy operationalisation and implementation; new data, methodologies and approaches; and a reaction to fundamental change.

In particular the change that is fundamental takes a longer term look at how technological (along with other) innovations might affect central banking over a lengthier horizon. This consists of, for example, exploring the impact of digital currencies or finance that is alternative, and any associated economic, technological and regulatory challenges.

As an element of its broader research agenda, the Bank publishes new datasets to facilitate external research. This can include run that is long data, the financial institution of England’s balance sheet and data recorded by the Bank’s regional agents. The long-term plan is to open up much more of the Bank’s data to the public.

The Bank has additionally set up an enhanced analytics division and data lab to exploit new and innovative analytical tools and techniques, analyse new data sources such as for instance social media marketing, and help spread practice that is best within the analysis of the latest big datasets both outside and inside the Bank.

The division is also developing relationships with external partners of this type, and recently ran a data visualisation competition to engage with data scientists and students over the UK.

Within the payments space, the financial institution is conducting research into innovations in payments technology, with a specific give attention to digital currencies together with distributed ledger systems that underpin them.

This builds from the Quarterly Bulletin articles published by the lender in 2014, which considered the technical architecture of digital currencies, plus the economic theories that govern how it works.

Polymer banknotes

Following extensive consultation that is public the Bank announced in December 2013 that new Bank of England banknotes will now be printed on polymer. Polymer is a thin and plastic that is flexible which has benefits over and above current paper banknotes.

Polymer notes are cleaner and more durable – they truly are more resistant to dirt and moisture, more environmentally friendly and last at the least 2.5 times longer than paper banknotes. Polymer notes may also be more secure, with advanced security features that provide a step-change in counterfeit resilience. The full design of the Ј5 note is going to be unveiled on 2 June together with banknote introduced in September 2016, aided by the Ј10 note issued in 2017, and Ј20 note by 2020.

Use essay helper of Bank of England facilities

The financial institution has broadened the product range of collateral accepted in its market operations to now include residential mortgages, asset finance, unsecured loans, automobile financing, corporate loans, SME loans and credit that is revolving.

This allows access for a wider range of counterparties – over 80 banks and building societies currently have assets placed at the Bank, ready to be used in initiatives for instance the Funding for Lending Scheme. Tasks are underway to ensure that there are no technical obstacles to the Bank’s capacity to accept equities as collateral should the need arise.

As part of its technique to broaden liquidity provision on the market, the lender commenced work with 2015 to assess the feasibility of establishing a Shari’ah compliant facility.

The Bank recognises the difficulties Islamic banks face in meeting liquidity requirements aided by the current range that is limited of – existing facilities are not Shari’ah compliant as they involve interest-bearing activity. The Bank has additionally become an associate member of the Islamic Financial Services Board (IFSB ).

With its provision of payment services, the financial institution has introduced prefunding for Bacs and Faster Payments, which lowers barriers to entry for banks and building societies trying to become members of these payment schemes.

Previously, a part of the schemes had to hold securities as collateral and agree to a mutual loss-sharing framework. Prefunding allows each institution to manage their exposure limit reserves that are using the financial institution.

In January 2016 the financial institution announced its want to design a blueprint for the future associated with the UK’s high value sterling settlement system – the true Time Gross Settlement System (RTGS ). The financial institution will appear to redesign RTGS in such a manner that its resilience is further enhanced, while on top of that enabling innovation.

2.8 How services that are financial are better utilising new technologies to come up with efficiency savings and minimize burdens on business – RegTech

Regulators not merely have a task to try out to advertise competition and innovation, but also in making use of technological advances to reduce regulatory burdens on firms and drive efficiency savings. The FCA and PRA have been particularly focused on this matter.

Firms have to meet higher regulatory standards and greater reporting requirements following the crisis that is financial. New technologies that help firms better manage these regulatory requirements and minimize compliance costs (so-called RegTech) are good for effective competition and innovation.

The main focus of these were to comprehend:

The goal of this consultation would be to seek views from the work of financial services regulators to aid innovative technology and disruptive business models, and understand where there can be gaps in regulatory approach when it comes to innovation that is supporting.

3.1 Consultation questions

The us government invites responses from all interested parties, in particular both regulated and unregulated firms and innovators in the financial services sector, in the following specific questions.

  1. Does the UK’s regulatory environment for financial services effectively support innovation?
  2. Do financial services regulators understand innovation in financial services and potential areas where new technologies and business that is disruptive might emerge when you look at the sector?
  3. Any kind of gaps in approach or areas where financial services regulators should be doing more to support innovative technology and disruptive business models in financial services?
  4. Will there be more that financial services regulators could do to better utilise new technologies to provide their work that is own more?

3.2 How to respond

This consultation will run from 22 April to 6 May 2016.

Responses must be sent by email to Innovation plan consultation.

Alternatively please send responses by post to:

Innovation Plan consultation
Banking and Credit team
HM Treasury
1 Horse Guards Road
London SW1A 2HQ

When responding, please say if you are making a representation on behalf of a small business, individual or representative body. When you look at the case of representative bodies, please provide all about the number and nature of people you represent.

3.3 Confidentiality

Information provided as a result to the consultation, including information that is personal could be published on disclosed prior to the access to information regimes. These are primarily the Freedom of Information Act 2000 (FOIA), the information Protection Act 1988 (DPA) while the Environmental Information Regulations 2004.

If you want the knowledge that you provide to be treated as confidential, please be conscious that, underneath the FOIA, there clearly was a statutory code of practice with which public authorities must comply and which relates to, amongst other things, obligations of confidence. In view with this it could be helpful in the event that you could explain to us why you regard the information you have got provided as confidential.

We will take full account of your explanation, but we cannot give an assurance that confidentiality can be maintained in all circumstances if we receive a request for disclosure of the information. An confidentiality that is automatic generated by your IT system will likely not, of itself, be seen as binding on HM Treasury.

HM Treasury will process your private data according to the DPA plus in the majority of circumstances this may mean that your individual data won’t be disclosed to parties that are third.