UK Finance has announced the successful completion of the Regulated Liability Network (RLN) Experimentation Phase, a pioneering initiative aimed at enhancing the UK’s financial market infrastructure. This collaborative effort, involving eleven major financial institutions, including Barclays, HSBC UK, and Mastercard, alongside technology partners such as R3 and Quant, explored the potential of RLN to revolutionise payments and settlements through tokenisation and programmable payments.
Since its commencement in April 2024, the RLN Experimentation Phase has highlighted several key benefits, including the reduction of fraud, improving the efficiency of home-buying processes, and lowering the cost of failed payments. Jana Mackintosh, Managing Director of Payments, Innovation and Resilience at UK Finance, stated, “The success of the RLN experiment shows the potential of technology to transform the customer experience and deliver economic value and benefits for society.”
The project explored a wide range of technical, legal, and business aspects. Among the findings was the potential for RLN to act as a ‘platform for innovation’, delivering economic value and supporting Open Banking initiatives. Moreover, the RLN’s programmable capabilities, such as the locking and unlocking of funds, offer promising new functionality. These advancements could provide new firms with a common access point to interface with established institutions and improve payment systems.
Industry leaders were vocal about the significance of the collaboration. Peter Left, Head of Digital and Markets Innovation at Lloyds Banking Group, described the RLN project as “a unique opportunity for industry collaboration to deliver a platform for innovation across the sector.” He further emphasised that the initiative aligned with both public and private sector objectives, providing long-term benefits for customers and the industry.
The RLN experiment also demonstrated the UK’s flexible regulatory framework, which is well-positioned to support future innovation. Tim Moncrieff of Visa commented on the collaborative nature of the project, noting that it “rigorously assessed the business, legal and technical considerations” and could “accelerate adoption of tokenised liabilities.”
Barclays’ Lee Braine highlighted the project’s role in mitigating fragmentation risks, while Gilbert Verdian, CEO of Quant, pointed out that RLN could “cement the UK’s leadership position in digital finance.”
As UK Finance and its members look ahead, they are eager for further engagement with regulators and public bodies to build on the RLN’s success. Paul Horlock of Santander UK praised the project’s focus on creating “better and safer outcomes for consumers” within a resilient infrastructure, stressing that “taking the time to experiment and test” is essential.
The Experimentation Phase also offered insights into the potential next steps for developing digital money infrastructure. Tom Wood from HSBC UK noted, “This has provided useful insight into the possible next steps for developing an infrastructure for digital money, in a scalable and sustainable way.”
As the payments sector continues to evolve, the RLN stands as a testament to the power of collaboration, with UK Finance and its partners optimistic about the potential of this new infrastructure. As Mackintosh remarked, the private sector is keen to invest in the future of commercial bank money, and a partnership with regulators is key to making that future a reality.
