UK Finance has released a report detailing the positive results of the experimentation phase of the Regulated Liability Network (RLN). The collaboration between UK Finance, Quant, R3, DXC Technology, and Coadjute found that the network could bring new functionalities to the UK’s financial system while also highlighting the flexibility of UK regulations to support its operations.
The experiment aimed to modernize the financial infrastructure by combining central bank money, commercial bank money, and electronic money in a shared ledger. Leading financial institutions like Barclays, Citi, HSBC, Lloyds Banking Group, Mastercard, Natwest, Nationwide, Santander, Standard Chartered, Virgin Money, and Visa participated in testing the feasibility of the project through various use cases.
The project concluded that integrating the RLN with other monetary initiatives could deliver economic value and bring innovation to financial markets. The introduction of programmable payments and the ability to lock and unlock funds based on specific use cases were identified as new functionalities.
The report also highlighted the benefits of a common interface point, allowing firms to connect with other institutions through a single network, simplifying complex financial processes. Additionally, it recognized the flexibility of UK regulation in supporting the implementation of the RLN.
Jana Mackintosh, UK Finance’s Managing Director of Payments, Innovation, and Operational Resilience, underlined the significance of the successful tests. She emphasized the transformative potential of technology in improving the customer experience and delivering economic value, stressing the need for collaboration between the private sector and regulators to continue investing in the future of commercial bank money.
Overall, the report showcases the positive outcomes of the Regulated Liability Network’s experimentation phase and highlights the potential for technology to drive advancements in the financial industry.