Key developments of interest over the last month include: the UK government publishing a Payments Forward Plan setting out a regulatory roadmap for the payments sector over the next three years; the German Federal Ministries of Finance and Justice launching an evaluation of the Electronic Securities Act; the UAE approving its first USD‑backed stablecoin under the Payment Token Services Regulation; Hong Kong preparing to issue its first stablecoin issuer licences in March 2026; and the U.S. SEC and CFTC outlining a coordinated “Project Crypto” agenda to harmonise digital asset regulation.
In this Newsletter:
- Regulatory Developments: Payments
- Regulatory Developments: Digital Assets
- Market Developments
- Surveys and Reports
For previous editions of the Payments Newsletters, please visit our Financial Services practice page.
United Kingdom: HM Treasury publishes Payments Forward Plan and industry advances plans to develop new national retail payments infrastructure
On 26 February 2026, HM Treasury (HMT) published the Payments Forward Plan, developed by the National Payments Vision's Payments Vision Delivery Committee (PVDC), which comprises representatives from the Bank of England (BoE), the FCA, the Payment Systems Regulator (PSR) and HMT.
The Plan is a regulatory roadmap for the payments sector over the next three years. It sets out ongoing and upcoming work across retail payments, wholesale payments and certain aspects of digital assets. Among other things, it includes details of timings for initiatives relating to:
- The modernisation of the regulatory framework: Initiatives include the consolidation of the PSR into the FCA and the review of retained EU payments law.
- Innovations in retail payments: Initiatives include the retail payments infrastructure design and delivery programme (see below for another recent development on this), stablecoin regulation and Open Banking.
- Consumer protection: Initiatives include those relating to authorised push payment (APP) fraud, anti-money laundering, the Payment and Electronic Money Special Administration Regime (PESAR), the FCA Consumer Duty and reforms to the Consumer Credit Act 1974.
The Plan is not exhaustive and timings remain subject to change.
The PVDC has agreed to add an enhanced focus on payments to the Regulatory Initiatives Grid in its first 2027 publication.
In a related development, on 16 February 2026 it was reported that senior executives from the UK’s largest banks are advancing plans to develop a new national retail payments infrastructure (part of the NPV). The initiative – referred to as “DeliveryCo” – is being coordinated by Barclays UK, with participation from banks including Lloyds, NatWest, Santander UK, Nationwide, and the Link ATM network. The project is city‑funded but government‑supported, with the Bank of England (BoE) developing the initial infrastructure blueprints. Visa and Mastercard are also participating in the discussions.
The new system is not expected to replace existing card schemes but to operate alongside them as a parallel, bank‑controlled alternative, with rollout targeted by 2030.
The BoE is also convening three new forums to help ensure that it captures a broad range of experiences, expertise and knowledge in developing the new retail payments infrastructure: the Payments End User Forum, the Payments Innovation Design Group and the Payments Academic Advisory Group. Applications to join the forums will remain open until 5pm on 3 March 2026.
United Kingdom: Bank of England publishes speech on work to design UK's next‑generation retail payments infrastructure
On 2 February 2026, the Bank of England (BoE) published a speech by Sarah Breeden (BoE Deputy Governor, Financial Stability) that focused on the work to renew the UK retail payments infrastructure and the BoE's role.
In context of wholesale payments, the speech refers to the fact that the BoE is closely engaged in the work of the Transatlantic Taskforce for Markets of the Future, as well as with the Monetary Authority of Singapore and other authorities on the ‘Global Layer 1 initiative, which is exploring common standards for DLT platforms.
Indonesia: Bank Indonesia joins BIS Nexus project for instant cross‑border payments
On 26 January 2026, it was reported that Indonesia's central bank, Bank Indonesia, had joined the Bank for International Settlements' (BIS) Nexus project, a multi central bank initiative to link domestic instant payment systems and improve the speed, cost and efficiency of cross‑border transfers. Bank Indonesia will now collaborate with central banks in Malaysia, the Philippines, Singapore, Thailand and India as the platform moves further into its implementation phase.
The initiative aligns with several policy priorities, including Indonesia's Payment System Blueprint 2030, ASEAN's Regional Payment Connectivity framework, and the G20 programme to improve cross‑border payment performance.
United States: Banking groups urge Congress to reject Credit Card Competition Act
On 22 January 2026, eleven U.S. banking and credit union groups sent a joint letter to Congress urging lawmakers to reject the Credit Card Competition Act (CCCA) and any expansion of the Durbin amendment. The CCCA is a federal proposal that would require the largest card‑issuing banks to enable at least two unaffiliated networks for processing credit card transactions, extending to credit cards the same routing choice rules and fee regulation principles introduced by the Durbin amendment in 2010, which imposed interchange caps and alternative routing mandates on debit card transactions.
The groups argue that the proposal would reduce consumer protections, undermine rewards programmes and restrict access to affordable credit, with the primary benefits flowing to the largest retailers rather than consumers or small businesses. According to the letter, nearly all projected savings under the CCCA would accrue to large corporate merchants, while small businesses could lose up to USD 1 billion in card rewards and face constrained access to credit. Community banks and credit unions warn that the bill's “backdoor price controls” on routing would weaken their ability to offer affordable financing and maintain investment in fraud prevention measures.
The groups also contend that the U.S. payments ecosystem is already highly competitive, with more than 4,000 card issuers and a range of payment methods available to consumers. They emphasise that similar reforms under the original Durbin amendment did not deliver lower prices for consumers, with the vast majority of retailers raising or maintaining prices instead.
United Kingdom: FCA publishes final rules for the UK’s new BNPL regime
On 11 February 2026, the FCA published policy statement (PS26/1), setting out the final rules that will apply to regulated Buy Now, Pay Later (BNPL) – formally “Deferred Payment Credit” (DPC) – firms. The FCA had consulted on its draft rules in July 2025 (CP25/23) and the policy statement confirms those proposals with several targeted adjustments.
Key takeaways from the policy statement (PS26/1) include:
- Minor changes to pre-contract information requirements and information requirements on missed payments.
- Regarding application of the wider Handbook, the FCA recognises that HM Treasury has recently consulted on proposals to streamline the Senior Managers and Certification Regime (SMCR) and that this may present uncertainties for DPC lenders seeking authorisation during a period of change. If SMCR changes are announced during the temporary permissions regime (TPR) that will be introduced, it will help such lenders to understand what requirements they will be subject to under the SMCR, and when.
- On dispute resolution:
- The proposal to amend the scope of the FOS’ voluntary jurisdiction to cover complaints about DPC activities carried on by a respondent from an EEA or Gibraltar establishment is not being taken forward.
- The FCA and the FOS acknowledge the concerns expressed by stakeholders about the proportionality of the FOS case fee to the low average value of DPC agreements; any recommendation to address this would be included in FOS' 2027/28 plan and budget consultation due in November 2026.
While the main go-live for the new BNPL regime is 15 July 2026, registration for the TPR will be open from 15 May 2026 until 1 July 2026. Firms will have 6 months from the regime go-live date to apply for full authorisation. The FCA will publish Directions on the process of notification for TPR registration in ‘good time’ before 15 May.
For further information, see our latest Our Thinking article as well as this previous Our Thinking article on CP25/23.
United Kingdom: Bank of England publishes policy statement on extending RTGS and CHAPS operating hours
On 24 February 2026, the Bank of England (BoE) published a policy statement on extending Real-Time Gross Settlement (RTGS) and CHAPS operating hours. This follows its July 2025 consultation, and the work forms part of the BoE's future roadmap for the renewed RTGS service (referred to by the BoE as RT2).
In the policy statement the BoE:
- Confirms that it will proceed with proposals for an early morning extension (EME) for CHAPs settlement hours by moving the start of settlement from 6.00 am to 1.30 am. The effect is that CHAPS direct participants (DPs) will have the option to send payments from 1.30am and that all CHAPS DPs will receive payments on their account used for CHAPS settlement in RTGS from 1.30 am, regardless of whether they actively send payments during this period. The intended go-live date for the EME is currently September 2027, and the BoE will share an implementation plan intended to allow CHAPS DPs sufficient time for system changes, staff training, and operational readiness.
- Notes that it has also decided:
- To explore refined proposals for additional bank holiday settlement, focusing on the demand, benefits and feasibility of enabling CHAPS and net settlement on certain bank holiday Mondays.
- Not to proceed with its proposal for a further extension to the evening contingency window, given limited demand. It will incorporate its consideration of a longer weekday operating window in the longer-term roadmap towards near 24x7 settlement. The BoE intends to publish a consultation paper in spring 2026 seeking views on the near 24x7 extension of RTGS and CHAPS settlement hours, discussing the opportunities, challenges and use cases of near 24x7 settlement and the steps needed to achieve it.
European Union: European Commission publishes call for evidence on fighting online fraud action plan
On 23 January 2026, the European Commission issued a call for evidence on a forthcoming Communication setting out an EU fighting online fraud action plan. The Commission explains that online fraud is now the fastest growing segment of organised crime across the EU, fuelled by increasing automation, behavioural manipulation techniques and rapid advances in AI. It notes that existing EU legislation – including PSD2, the Digital Services Act and the Network and Information Security Directive 2 – addresses elements of the problem, but that overall effectiveness is currently limited by fragmented implementation, insufficient coordination and resource constraints.
According to the Commission, the future action plan will aim to ensure coherent deployment of existing EU initiatives that regulate digital transactions, protect consumers and target the proceeds of online fraud. Its main objective will be to prevent technology‑enabled fraud (online or telephone‑based) by strengthening EU‑level coordination, enhancing law enforcement action and improving victim support. The Commission stresses that EU intervention is essential given the inherently cross‑border nature of online fraud.
No standalone public consultation is planned for this initiative. Instead, the Commission will conduct targeted stakeholder engagement through established platforms and networks. The call for evidence was open for public feedback until 13 February 2026 and the Commission intends to adopt the resulting Communication in Q2 2026.
United Kingdom: HM Treasury consults on reforms to the Appointed Representatives regime
On 12 February 2026, HM Treasury (HMT) launched a consultation on proposed reforms to the UK’s Appointed Representatives (ARs) regime, following its August 2025 policy statement.
The proposed changes include:
- requiring authorised firms to have permission from the FCA before they can appoint ARs;
- extending the jurisdiction of the Financial Ombudsman Service (FOS) to apply directly to ARs in certain circumstances; and
- bringing ARs within the scope of the Senior Managers & Certification Regime.
The consultation closes on 9 April 2026.
For further reading, take a look at this Our Thinking article.
United Kingdom: FCA launches Regulatory Priorities Reports
On 24 February 2026, the FCA published a new webpage confirming that it is introducing nine annual sector-specific Regulatory Priorities Reports to replace its portfolio letters, the first of which – for insurance – was also published. The Reports for the other sectors, including payments and retail banking, will be published in March 2026.
The FCA also published a blog about the new Reports entitled “A smarter approach to communicating our regulatory priorities”.
United Kingdom: FCA publishes new and updated Consumer Duty webpages
On 25 February 2026, the FCA:
European Union: EBA publishes opinion on end of PSD2–MiCA transition period
On 12 February 2026, the EBA published an opinion advising national competent authorities (NCAs) on the actions to take once the transition period under its June 2025 No‑Action Letter ends on 2 March 2026. The transition period was introduced to manage the regulatory overlap between MiCA, under which electronic money tokens (EMTs) are treated as cryptoassets, and PSD2, under which EMTs also constitute electronic money and may give rise to payment services requiring authorisation.
In its 2025 No‑Action Letter, the EBA clarified that only a subset of EMT‑related activities (including certain transfer services and custody/administration of EMTs) may constitute payment services under PSD2. It also advised NCAs to adopt streamlined authorisation processes and to delay requiring dual authorisation until the end of the transition period.
With that deadline approaching, the new opinion outlines three scenarios for cryptoasset service providers (CASPs) wishing to continue providing EMT services that qualify as payment services:
- CASPs already authorised (or operating via an authorised PSP): Firms holding payment institution or e‑money institution authorisation or partnering with an authorised provider may continue operating without interruption.
- CASPs with a pending PSD2 application: CASPs that have submitted a complete application, engaged proactively with supervisory queries, and have no significant breaches under MiCA or AML rules may be permitted to continue providing EMT‑related payment services temporarily. During this period, firms must cease marketing these services and refrain from onboarding new customers.
- CASPs without an application or failing to meet conditions: Firms that do not apply, or whose applications do not meet the required standards, must cease EMT‑related payment services from 2 March 2026 and off‑board affected clients.
The EBA notes that more than 100 CASPs have already approached NCAs or filed applications since the No‑Action Letter was issued. The guidance is intended to help NCAs prioritise authorisation work and ensure a consistent supervisory approach during the transition to the forthcoming PSD3 and Payment Services Regulation frameworks.
For more on this development, take a look at this Our Thinking article.
Germany: Federal Ministries launch evaluation of the Electronic Securities Act (eWpG)
As our Financial Services team in Frankfurt recently highlighted, the German Federal Ministry of Finance and the Federal Ministry of Justice have launched an evaluation of the Electronic Securities Act (eWpG). The Electronic Securities Act has been in force since 2021 and provides a civil-law framework for issuing electronic securities, including DLT-based crypto securities (certain shares, debt securities and fund units).
The goal of the evaluation is to assess whether investor protection, market integrity, innovation support and AML measures have proven effective. Market participants are invited to share experiences and suggestions for improvements, for example on:
- the practicality, clarity and legal certainty of the rules for issuing electronic/crypto securities;
- a possible extension of the regime to other asset classes;
- the level of investor protection compared to traditional securities;
- international competitiveness of the regime; and
- a possible EU harmonization of the rules for issuing electronic securities, including the preferred type of regime (harmonization of national crypto-securities laws vs. a parallel EU 28th regime).
Feedback should be submitted by 15 March 2026.
Hong Kong: First stablecoin licences expected in March 2026
On 2 February 2026, it was reported that Hong Kong is preparing to issue its first stablecoin issuer licences in March 2026, with only a “very small number” of successful applicants expected in the initial batch. According to Hong Kong Monetary Authority (HKMA) Chief Executive Eddie Yue, the regulator is nearing completion of its review of the first tranche of applications, with assessments focused on use cases, risk management, anti money laundering controls and the quality of backing assets.
Speaking separately at the Consensus Hong Kong conference, Hong Kong Financial Secretary Paul Chan reiterated that licences would only be granted to issuers demonstrating credible and sustainable business models, strong compliance capabilities and clear real economy use cases. He added that Hong Kong is also finalising its new custodian service provider licensing regime and is preparing additional legislation to complete its digital asset regulatory framework.
According to reports, the HKMA confirmed that licensed issuers will need to comply with rules governing cross border activities, with potential future mutual recognition arrangements expected to be explored with overseas regulators.
Chan also reportedly pointed to several trends shaping Hong Kong’s digital asset strategy, including:
- rapid institutional adoption of tokenised real world assets;
- increasing interaction between DeFi and traditional finance; and
- the emergence of a “machine economy”, where autonomous AI agents may hold and transfer digital assets, pay for services and transact on chain.
These developments, he stated, underscore the need for a comprehensive and future proof regulatory framework.
Japan: FSA launches consultation on stablecoin reserve standards and intermediary supervision
On 26 January 2026, Japan's Financial Services Agency (FSA) opened a public consultation, running until 27 February 2026, on detailed draft rules governing the reserve assets for regulated stablecoins issued through trust structures under the country's amended Payment Services Act. The consultation package sets out proposed criteria for determining which bonds may be used as backing assets and forms part of the FSA's implementation of Act No. 66 of 2025, which overhauled Japan's regulatory framework for settlement and electronic payment instruments.
Under the proposed standards, only a limited class of foreign‑issued bonds would be eligible as collateral. The bonds must (i) carry a high credit rating corresponding to credit risk category 1–2 or better from a designated agency, and (ii) be issued by an entity with at least ¥100 trillion (approximately USD 648 billion) in outstanding bonds. The intention is to anchor reserves in liquid, secure and transparent assets, thereby reducing credit and liquidity risks for users of yen‑pegged stablecoins.
In parallel, it was reported that the FSA has proposed new supervisory guidelines for banks, insurers and subsidiaries offering crypto intermediation services. A new clause would require subsidiaries providing crypto‑related services to give clear explanations of product risks to customers, aiming to avoid misconceptions that cryptoassets are low‑risk merely because they appear within a traditional financial group structure. The consultation also introduces additional checks for businesses seeking to handle foreign‑issued stablecoins, including demonstrating that the overseas issuer will not issue, redeem or solicit stablecoin transactions from Japanese users. The FSA indicated plans for greater information‑sharing with overseas regulators as part of this oversight.
These proposals sit against a backdrop of expanding domestic stablecoin innovation, including Japan's first legally recognised yen‑backed stablecoin launched in late 2025, as well as pilots across the country's three megabanks exploring stablecoins and tokenised deposits for payments, settlement and institutional financial services.
United Kingdom: FCA takes first court action against crypto exchange for illegal financial promotions
On 10 February 2026, the FCA announced that it has begun legal proceedings in the English courts against global crypto exchange HTX (formerly Huobi) and persons unknown (being those individuals who operate and control HTX) seeking both an injunction preventing the defendants from promoting cryptoasset services to UK consumers in breach of the FCA's rules on financial promotions and a declaration that the defendants are in breach of these rules. This is the first FCA enforcement action of its kind.
Take a look at this Our Thinking article for more on this development.
United Kingdom: FCA selects four firms to test stablecoin innovation in its Regulatory Sandbox
On 25 February 2026, the FCA announced that it has chosen four firms to test how their stablecoin services work with its proposed regulation in the ‘safe environment' of its Regulatory Sandbox. The 4 firms are Monee Financial Technologies, ReStabilise, Revolut and VVTX.
The FCA's testing will focus primarily on stablecoin issuance and the four firms will pilot a range of use cases, including payments, wholesale settlement and crypto trading. Testing begins in Q1 2026 and the findings will help to shape the UK's final stablecoin rules later in 2026.
United States: SEC and CFTC outline coordinated “Project Crypto” agenda to harmonise digital asset regulation
On 29 January 2026, it was announced that SEC Chair Paul Atkins and new CFTC Chair Mike Selig had held their first joint SEC-CFTC “harmonisation” event, during which they unveiled Project Crypto, a cross agency initiative to align regulatory approaches, streamline oversight and provide clearer jurisdictional boundaries in U.S. digital asset markets.
Atkins emphasised that the agencies intend to reduce duplicative or conflicting obligations by developing a coherent asset taxonomy, coordinated definitions and minimum effective dose, risk based rules calibrated for integrated on chain trading, clearing, settlement and custody. He noted the agencies’ aim to provide near term clarity while preparing for potential Congressional market structure legislation that could arrive later in 2026.
Selig used his first public remarks as CFTC Chair to outline an ambitious policy agenda, including:
- expanding recognition of tokenised collateral;
- enabling “true” perpetual crypto derivatives and other novel products to trade onshore under U.S. law;
- establishing safe harbours for software developers;
- exploring a retail focused category of exchange registration for leveraged or margined crypto trading; and
- progressing a new rulemaking on event contracts (prediction markets).
Both Chairs confirmed plans for a formal memorandum of understanding to institutionalise coordination on supervision, surveillance and information sharing.
United Kingdom: FCA consults on application of Handbook for cryptoasset activities
On 23 January 2026, the FCA released consultation paper CP26/4, the latest and most wide ranging consultation in the UK’s crypto regulatory roadmap. CP26/4 sets out how major components of the FCA Handbook – including Consumer Duty, COBS, DISP, training and competence, regulatory reporting, and aspects of the SM&CR – would apply to firms conducting regulated cryptoasset activities under the forthcoming FSMA based regime. Key points to note include:
- The FCA confirms its proposal to apply the Consumer Duty to cryptoasset firms serving retail users, supported by additional guidance illustrating how firms should assess good customer outcomes, evaluate product value and manage disclosure obligations in a digital asset context. Crypto firms would also fall within the compulsory jurisdiction of the Financial Ombudsman Service (FOS), with the FCA setting expectations for formal complaints procedures under DISP, while noting that FSCS protection will not extend to cryptoasset activities.
- On conduct standards, CP26/4 proposes adapting the COBS rulebook for cryptoassets, including new rules for crypto lending and borrowing services and updated “appropriateness” assessments tailored to tokenised and decentralised products. The consultation also details how the Client Assets regime would apply to qualifying cryptoasset custodians and specified investment cryptoasset custodians, reflecting the unique challenges of safeguarding assets that depend on private key management.
- The FCA additionally outlines its proposed location policy, under which most firms serving UK clients would be expected to operate through a UK established legal entity, with limited flexibility for certain international crypto trading platform functions where global liquidity access is essential.
The consultation closes on 12 March 2026. Following consideration of the responses, the FCA will publish policy statements later in 2026 containing its final rules and guidance.
The FCA has also announced that it will open its gateway for cryptoasset permissions on 30 September 2026 and that the regime will go live on 25 October 2027.
For further reading on this topic, see this Our Thinking article.
Australia: ASIC highlights digital asset and AI risks at the regulatory perimeter
On 27 January 2026, the Australian Securities and Investments Commission (ASIC) released a new report entitled “Key issues outlook 2026”, in which it identified digital assets, payments innovations and AI‑based financial services as key regulatory perimeter risks for 2026, warning that rapid innovation continues to generate consumer and market harms where activities fall outside formal licensing frameworks.
In the report, ASIC drew attention to unlicensed crypto advisers, misleading conduct by emerging market participants and firms intentionally structuring activity to remain outside regulation. ASIC also noted that decisions on whether new digital asset products should be brought into licensing regimes ultimately rest with government, but that the regulator will prioritise monitoring boundary issues, strengthening oversight and addressing regulatory uncertainty where it risks undermining consumer protection. These concerns emerge amid growing domestic crypto engagement, with Australia ranking among the world's highest crypto‑adoption markets.
United Kingdom: House of Lords launches inquiry into stablecoin regulation
On 29 January 2026, the House of Lords Financial Services Regulation Committee launched a wide-ranging inquiry into the growth, use and proposed regulation of stablecoins in the UK. The Committee notes that stablecoins have been developing in the UK and globally since around 2014 and seeks evidence on how the market's scale, characteristics and use cases have changed over time. It is particularly interested in how sterling‑denominated stablecoins may emerge in practice, the potential competitiveness benefits they could offer to the UK as a financial centre, and the risks they may pose to consumers, financial stability, market integrity and monetary sovereignty.
The Committee is also examining the regulatory regimes proposed by both the Bank of England and the FCA, including whether the UK's dual regulatory model – under which the Bank would supervise systemic stablecoin issuers and payment systems while the FCA would regulate non‑systemic issuance and conduct – provides proportionate, coherent and effective oversight.
Written submissions are invited until 11 March 2026.
Thailand: SEC plans expansion of digital asset investment framework
On 22 January 2026, it was reported that Thailand's Securities and Exchange Commission (SEC) is preparing a broad expansion of the country's digital asset investment framework with new rules aimed at enabling a wider range of regulated products and strengthening market infrastructure.
According to the SEC, forthcoming measures will include formal guidelines for crypto exchange‑traded funds, permitting licensed asset managers to offer regulated exposure to digital assets through on‑exchange vehicles, as well as rules to allow crypto futures trading on the Thailand Futures Exchange. The SEC is also expected to extend the existing tokenisation regime to cover a wider set of investment‑grade tokenised instruments, including bond tokens, tokenised fund units, and other on‑chain representations of traditional securities.
The SEC indicated that the upcoming rules are intended not only to expand product availability but also to raise investor protection standards and to respond to international developments in tokenised assets, crypto ETFs, and derivatives markets.
Pakistan: Regulator emphasises clarity as foundation for digital asset ecosystem
On 28 January 2026, it was reported that Pakistan's Virtual Assets Regulatory Authority (VARA) leadership has highlighted regulatory clarity as central to the country's digital asset strategy. The VARA chairperson indicated that Pakistan intends to move “from confusion to clarity,” establishing a regulatory framework designed to attract capital, support domestic founders and provide a platform for innovation across regions spanning Morocco to Malaysia.
The regulator also referenced Pakistan's partnerships with international crypto firms as part of a broader ambition to position the country as a competitive hub for Web3 development.
United Kingdom: Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026 published
On 4 February 2026, the government published the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026 (SI 2026/102), which establish the regulatory framework for qualifying cryptoassets, qualifying stablecoins and specified investment cryptoassets. This follows the laying of the Regulations before Parliament, as reported in our January 2026 edition.
The Regulations amend the Financial Services and Markets Act 2000 (Regulated Activities) Order (RAO) to define new categories of regulated cryptoassets and to specify regulated activities, including issuing qualifying stablecoins, operating cryptoasset trading platforms, safeguarding qualifying cryptoassets and providing staking services. The Regulations also introduce designated activities under Part 5A FSMA for public offers and admissions to trading, including prohibitions on making public offers of qualifying cryptoassets unless falling within prescribed exceptions.
Additionally, the Regulations establish a cryptoasset market abuse framework, addressing insider dealing, unlawful disclosure of inside information and market manipulation in relation to relevant qualifying cryptoassets. A series of consequential amendments are also made to align anti‑money laundering and financial promotion rules with the expanded perimeter.
The Regulations will come into force on 25 October 2027. HM Treasury is required to review the Regulations within five years of commencement and subsequently at five‑year intervals.
United Arab Emirates: Central bank approves first USD‑backed stablecoin under PTSR
On 29 January 2026, it was reported that the Central Bank of the UAE (CBUAE) had approved the country's first USD‑backed stablecoin – USDU - under its Payment Token Services Regulation (PTSR), marking a major step in the UAE's regulated stablecoin framework.
USDU is fully backed 1:1 with U.S. dollars, held in safeguarded onshore accounts at Emirates NBD and Mashreq, with monthly reserve attestations. Under the PTSR, only fiat or an approved Registered Foreign Payment Token can be used for digital asset payments and derivatives, making USDU the first compliant USD settlement option within the UAE's regulated framework.
The approval positions the UAE as one of the first jurisdictions globally to license U.S. dollar-denominated payment tokens under a dedicated regulatory regime.
European Union: ECON publishes draft report on digital assets
On 23 February 2026, the European Parliament's Committee on Economic and Monetary Affairs (ECON) published a draft report on the challenges posed by digital assets for the competitiveness and integrity of the EU's financial system. The draft report:
- Contains a draft European Parliament legislative resolution, which explores the impact of the emergence of digital assets on the financial services sector and its meaning for the regulatory framework, in particular under the Markets in Cryptoassets Regulation ((EU) 2023/1114) (MiCA) and the DLT Pilot Regime Regulation ((EU) 2022/858).
- Highlights several risks that remain for the digital assets sector and addresses the following topics:
- Cryptoassets: The importance of strengthening data capabilities is emphasised. Relevant regulatory bodies are called on to strengthen the supervisory dialogue on significant multi-function groups (MFGs) and the need to align the policy framework under MiCA for significant non-bank MFGs is underlined. The fact that cryptoassets are still too often used to evade anti-money laundering and counter-terrorism financing regulations and sanctions is also highlighted.
- Stablecoins: The Commission is called on to urgently propose legislation providing legal clarity on the possibility of multi-issuance of stablecoins by an EU and a non-EU entity, where the digital stablecoins issued by both entities are fully fungible and indistinguishable. Strong prudential safeguards, robust co-operation arrangements and enhanced crisis management protocols are also called for.
- Tokenisation: In light of the ongoing discussions on the DLT Pilot Regime, the explanatory memorandum acknowledges that trial and error is still necessary to discover the advantages of tokenisation and highlights the ongoing need to monitor vulnerabilities.
- Interoperability: This is crucial in digital finance, and the assessment of legal entity identifier and verifiable legal entity identifier-type approaches as infrastructure-grade tools is also important.
United Kingdom: Bank of England publishes speech on shaping the UK's digital financial future
On 29 January 2026, the Bank of England published a speech by Sasha Mills, Executive Director, Financial Market Infrastructure, entitled: 'The sky's the limit: shaping the UK's digital financial future.' Key points from the speech include:
- 2026 is going to be ‘fundamental in shaping the UK's digital financial future'.
- This year, the Bank will prioritise three key areas of innovation: (1) systemic stablecoins (including working with the FCA to test the use of regulated stablecoins as a settlement asset in the Digital Securities Sandbox (DSS)), (2) clarifying the Bank's policy on the treatment of tokenised collateral under UK EMIR, and (3) the DSS.
- The Bank aims to finalise the regime for systemic stablecoins, working with the FCA, by the end of this year.
- It will set out further policy later this year on how tokenised collateral can operate under the existing regulatory framework. Firms are encouraged to reach out and continue the conversation with the Bank – whether on emerging opportunities or practical challenges.
- As wholesale activity in the DSS is subject to limits on overall issuance to contain risks to the broader financial sector, it offers a helpful environment to test the use of stablecoins for wholesale settlement in a controlled setting. The Bank is continuing to expand the remit of the DSS to facilitate responsible innovation.
- It is working ‘at speed' with the FCA and HM Treasury (HMT) to expand the range of settlement assets in the DSS to include regulated stablecoins.
- It is also developing an assessment framework to help it determine a set of regulated stablecoins – issued both domestically and in other jurisdictions – that meet high enough standards for use in the DSS, eg the Bank will set out criteria around, among other things, the quality and composition of backing assets, ability to meet redemptions, and capital requirements.
- The Bank is also working with the FCA to consider the ecosystem around stablecoin use in wholesale markets, and whether certain guardrails are appropriate, eg the suitability of different custody solutions, their compliance with proposed FCA custody requirements, and ways of obtaining stablecoins for use in the DSS. Domestic stablecoins which meet the high standards of the Bank's systemic stablecoin regime will be permitted in the DSS.
- There is also mention of the September 2025 launch of the HMT and U.S. Treasury's Transatlantic Taskforce for Markets of the Future. As digital assets are a focus of the Taskforce, the DSS provides a ‘valuable opportunity to share learnings and identify areas for cross border cooperation.'
European Union: ESMA publishes official translations of guidelines on assessing knowledge and competence under MiCA
On 28 January 20206, ESMA published a webpage with the official translations, including the English language version, of its guidelines for the criteria to assess knowledge and competence under the Regulation on markets in cryptoassets ((EU) 2023/1114) (MiCA). The guidelines will apply from 28 July 2026.
Europe: Form3 and SumUp announce expansion of partnership for SEPA payments
On 26 February 2026, it was reported that Form3 and SumUp had expanded their existing partnership to offer SEPA Instant, SEPA Credit Transfer, and SEPA Direct Debit capabilities to SumUp's European merchant base.
This development builds on the firms' existing collaboration covering UK payment schemes, under which SumUp already connects to Faster Payments and Bacs through Form3's cloud-native payments platform. It allows SumUp to consolidate its European and UK payment processing through a single platform provider.
Canada: Payments Canada admits five new PSP members
On 27 January 2026, Payments Canada announced that it had admitted five new payment service provider (PSP) members – Wise, Float, KOHO, Paramount Commerce and Brim – following recent legislative amendments to the Canadian Payments Act that expanded membership eligibility to registered PSPs, credit union locals and designated clearing houses.
Payments Canada stated that the broadened membership base is intended to strengthen competition, support innovation, and prepare the ecosystem for the launch of Canada's imminent Real‑Time Rail system. The new members will gain access to Payments Canada's governance processes and core clearing systems, which processed more than CAD 411 billion daily in 2025.
United States: Tether launches USA₮ under the U.S. GENIUS Act
On 27 January 2026, Tether announced that it had formally launched USA₮, a federally regulated, dollar‑backed stablecoin issued through Anchorage Digital Bank under the United States' new GENIUS Act framework.
USA₮ is designed specifically for the U.S. market and is issued by a nationally chartered bank, with Cantor Fitzgerald serving as reserve custodian. Tether emphasised that USA₮ is distinct from USD₮, which will continue operating internationally. The new token allows Tether to offer a fully compliant U.S.‑regulated stablecoin while maintaining USD₮'s global footprint; both products are designed to serve different regulatory environments. The company noted that the launch signals an evolution in the digital dollar market as stablecoins become more deeply integrated into mainstream U.S. financial infrastructure.
Global: Checkout.com partners with Spotify for global acquiring
On 3 February 2026, Checkout announced that it had entered a long‑term global acquiring partnership with Spotify, providing payment processing across more than 180 countries.
Spotify will adopt Checkout.com's AI‑driven Intelligent Acceptance engine, which performs millions of real‑time optimisations daily, to improve authorisation rates, reduce payment failure and strengthen recurring subscription billing across its more than 280 million paying subscribers. The partnership also includes network tokenisation and enhanced authentication services to reduce fraud and improve payment continuity for Spotify's global audience.
United Arab Emirates: PayPal teams up with NEO PAY to enhance UAE cross‑border commerce
On 8 February 2026, it was reported that PayPal had partnered with UAE-based digital payments provider NEO PAY, enabling UAE merchants – particularly SMEs – to accept PayPal payments and expand into international markets.
The partnership combines PayPal's global trust and consumer reach with NEO PAY's local acquiring infrastructure, facilitating faster onboarding and delivering a compliant, secure payment option for businesses targeting cross‑border e‑commerce and supports the UAE's rapidly expanding digital economy, with e‑commerce volumes expected to reach USD 21.18 billion by 2030.
Saudi Arabia: EdfaPay launches Smart SoftPOS in Saudi Arabia
On 22 January 2026, it was reported that EdfaPay – a Saudi‑based payments technology provider offering modern, API‑driven infrastructure for banks, licensed payment companies and merchant service providers – had received technical approval from the Saudi Central Bank to activate its Smart SoftPOS service. This platform is designed to enable merchants across Saudi Arabia to accept contactless card payments directly on any Android smartphone or tablet without dedicated POS hardware. EdfaPay's unified payment platform, which includes a secure e‑payment gateway and multiple digital channels, also supports white‑label and API‑driven deployments for banks and fintechs.
The rollout aligns with the Kingdom's broader Vision 2030 ambition to accelerate cashless payments and expand acceptance infrastructure.
United States: Nubank wins conditional approval to establish a U.S. national bank
On 29 January 2026, Nubank - one of the world's largest digital banking platforms - announced that it had received conditional approval from the U.S. Office of the Comptroller of the Currency to form a national bank, allowing it to offer deposits, lending, credit cards and digital asset custody in the United States. The approval places Nubank into the “bank organisation phase” during which it must satisfy capital, governance and supervisory requirements and obtain additional authorisations from the Federal Reserve and the FDIC before operations may begin.
The bank is expected to be capitalised within 12 months, with operations targeted to begin within 18 months.
United Arab Emirates: Dubai Insurance launches crypto wallet for premiums and claims
On 29 January 2026, it was reported that Dubai Insurance had become the first insurer globally to launch a crypto‑enabled insurance wallet in the UAE, allowing policyholders to pay premiums and receive claims in digital assets. The insurer, the fourth largest in the UAE, developed the wallet in partnership with Zodia Custody, the Standard Chartered-backed crypto custodian, as part of the UAE's broader push to integrate digital assets into mainstream financial services.
The launch follows the country's new central bank law bringing digital assets and DeFi into conventional compliance regimes. Dubai Insurance stated that the initiative reflects a major shift in how insurers may adopt on‑chain infrastructure, providing secure, regulated digital asset payment rails within traditional insurance frameworks.
India: NPCI collaborates with NVIDIA to build payments-native AI model
On 20 February 2026, it was reported that India's National Payments Corporation of India (NPCI) – which oversees the country's retail payments and settlement systems - has entered into a collaboration with NVIDIA, the U.S.-based semiconductor company, to expand its sovereign AI capabilities within the country's digital payments infrastructure.
The initiative forms part of NPCI's ongoing AI programme and focuses on the joint development of a payments-native AI foundation model built to comply with India's regulatory and data sovereignty requirements. NPCI will use NVIDIA Nemotron, a collection of open models, datasets, and technologies designed to support agentic AI systems, in its model development work.
Egypt: ADCB Egypt implements Temenos Payments Hub
On 28 January 2026, Temenos announced that ADCB Egypt – the Egyptian subsidiary of Abu Dhabi Commercial Bank Group – had implemented the Temenos Payments Hub, enabling the bank to deliver faster and more efficient cross‑border payments and adopt ISO 20022 SWIFT MX messaging standards. The solution is intended to improve operational efficiency, enhance straight‑through processing and support ADCB's digital modernisation efforts in Egypt's payments ecosystem.
Mexico and Indonesia: Payoneer expands collection services in Mexico and Indonesia
On 29 January 2026, Payoneer - a global financial technology company specialising in cross‑border payments for SMEs, freelancers and digital businesses - announced that it had expanded its collection services into Mexico and Indonesia, two of the fastest‑growing digital commerce economies globally.
The expansion will allow local businesses, marketplace sellers and service providers to receive payments in their local currency via Payoneer's international acquiring and settlement network. The company stated that the move aims to remove long‑standing friction points faced by SMEs trading internationally, including high foreign exchange costs, delays in settlement and the need to maintain multiple foreign accounts.
The expansion forms part of Payoneer's wider strategy to deepen its presence across high‑growth emerging markets, following similar rollouts across parts of Latin America and Southeast Asia.
Japan: India's UPI network set to launch in Japan
On 24 January 2026, it was reported that India's Unified Payments Interface (UPI), one of the world's largest real‑time payment systems, was set to launch in Japan, marking one of the most significant international expansions of the platform to date.
Japan's adoption of UPI will enable QR‑code‑based mobile payments for both residents and inbound tourists, supporting faster, low‑cost digital transactions and reducing the country's continued dependence on cash, which still accounts for a sizeable share of retail payments. The move is expected to enhance payment efficiency, especially for visitors from India, who will be able to use familiar UPI‑enabled apps while travelling.
UPI's entry into Japan forms part of India's broader strategy to internationalise its payments infrastructure, following earlier collaborations with markets in Singapore, the UAE, France, and Nepal.
Africa: Nigeria and Ghana launch instant wallet‑based cross‑border payments
On 4 February 2026, it was reported that Nigeria and Ghana had jointly launched an instant wallet‑based cross‑border payments system, enabling users in both countries to transfer funds directly between mobile wallets without relying on correspondent banking channels. The service allows individuals and small businesses to initiate transfers in local currency from within their existing wallet applications, with funds delivered in near real time on the recipient side.
According to reporting, the initiative is supported by both countries' national payment system operators and is designed to lower transaction costs, reduce dependency on informal transfer routes and improve settlement speed, which has traditionally been slowed by reliance on intermediary banks.
Mexico: Revolut launches full banking operations in Mexico
On 27 January 2026, Revolut announced that it had launched full banking operations in Mexico, marking its first regulated bank outside Europe. Revolut Bank S.A., now licensed as an Institución de Banca Múltiple, enters the market with more than USD 100 million in capital and with strong inaugural credit ratings from HR Ratings and S&P.
The launch enables Revolut to offer a suite of regulated banking services to consumers in Mexico, including high‑yield savings accounts, multi‑currency accounts, low‑cost international transfers, joint accounts, and bill payment features, with plans to introduce children's accounts, premium subscription tiers and additional financial products as part of its broader global expansion strategy.
According to Revolut, Mexico will serve as a blueprint for expansion into other high‑growth markets, given the country's large underbanked population and rapidly increasing adoption of digital financial services.
Europe: ClearBank forecasts SEPA Instant to overtake traditional transfers by 2030
On 21 January 2026 ClearBank published a new research report developed with Celent and in collaboration with Plaid, forecasting that SEPA Instant Credit Transfers will overtake traditional SEPA Credit Transfers by 2030 and become the second most used non‑cash payment method in Europe by 2035, accounting for an estimated 18% of all eurozone transactions.
According to the study, this transformation is being driven by the EU's Instant Payments Regulation, which mandates that all banks, electronic money institutions (EMIs) and payment institutions (PIs), including firms outside the euro area, must be able to send and receive instant euro payments by July 2027 and must price instant transfers no higher than standard credit transfers.
The research highlights significant divergence in industry readiness, with 55% of banks already meeting the 2027 requirements while around one in five EMIs and PIs expect to miss the deadline by up to six months. ClearBank and Celent also found substantial investment disparities: 61% of banks expect compliance costs above EUR 20 million, compared with most non‑banks whose projected spending is below EUR 10 million.
These differences are projected to shape competitive dynamics across the ecosystem, as new access models intensify pressure on incumbent banks to deliver high quality instant payment services.
Global: Sumsub’s Fraud Exposure Survey 2025 highlights growth in identity takeover fraud
On 20 January 2026, Sumsub released its Fraud Exposure Survey 2025, which found that fraudsters are increasingly shifting from traditional financial theft to large scale identity takeovers and long duration account compromise schemes.
The report draws on analysis of 4 million fraud attempts and a survey of more than 1,200 consumers and 300 fraud risk professionals across Latin America, North America, Europe, Asia, Africa and the Middle East.
Sumsub notes that while fraud volumes are becoming more concentrated, attacks are now more sophisticated, more targeted and more resource intensive, often powered by AI enabled tools and “fraud as a service” platforms.
According to the findings:
- 53% of APAC consumers experienced fraud in 2025, with phishing and weak passwords cited as the main points of compromise;
- More than half of consumers reported encounters with deepfakes, underscoring the rising quality of synthetic media used for impersonation; and
- Businesses surveyed identified synthetic identities, chargeback abuse, deepfake driven verification bypasses and application fraud as the leading first party schemes, while third party attacks were dominated by identity theft, account takeover, card testing and bot driven attacks.
Sumsub concludes that identity fraud has entered a new “sophistication era,” where human vulnerabilities, combined with AI driven social engineering techniques, are enabling deeper, longer-term breaches of digital identity systems.
