February 2025: Top five payments stories of the month
February has witnessed several major developments in the payments sector. Here, we run through five of the top payments stories from the month, featuring Vantage Bank, European Central Bank, Finzly, and more.
UK government reportedly considering plans to scrap the Payment Systems Regulator
UK government reportedly considering scrapping PSR
The UK government is reportedly mulling plans to scrap the Payment Systems Regulator (PSR) and merge its functions into the Financial Conduct Authority (FCA), according to a report by Sky News, citing sources with knowledge of the discussions.
While no final details have been confirmed, the report states that ministers and officials are set to reach a preliminary decision within weeks.
The PSR has been fully operational since 1 April 2015 and is responsible for overseeing the UK’s payment systems. The body seeks to ensure sector accessibility, security, and transparency for consumers and businesses, and reports directly to parliament.
In a statement sent to FinTech Futures, the PSR says: “It’s well known the government is auditing the role of regulators, and decisions on the regulatory structure are rightly for them and parliament.
“We are focused on working with the FCA and the Bank of England to deliver safe, competitive and innovative payment systems.”
ECB plots new platform for DLT transaction settlements with central bank money
The European Central Bank (ECB) has outlined plans to develop a new platform that will enable the settlement of transactions using central bank money on distributed ledger technology (DLT).
The platform forms part of the central bank’s “two-track approach” to refining transaction speeds and will be linked to Target Services, part of the ECB’s existing infrastructure for payments.
Part two of this approach will see the ECB explore “a more integrated, long-term solution for settling DLT-based transactions in central bank money”, aiming to include international transactions like foreign exchange settlements.
This is expected to be a more long-term initiative, inclusive of public and private stakeholder engagement, and would likely require more complex development.
Papua New Guinea’s central bank successfully completes CBDC trial with Japan’s Soramitsu
Papua New Guinea moves closer to launching a CBDC
The Bank of Papua New Guinea, in partnership with the Japanese Ministry of Economy, Trade and Industry (METI) and Tokyo-based fintech Soramitsu, has completed a proof of concept (PoC) for its proposed central bank digital currency (CBDC), named the Digital Kina.
The trial leveraged Soramitsu’s blockchain technology supported by the SORA v3 Hub Chain, an international platform powered by the open-source Hyperledger Iroha 2 blockchain.
According to a Soramitsu statement translated from Japanese, the PoC involved the creation of a “secure payment infrastructure that could operate 24 hours a day and demonstrated instantaneous payments and international remittances”.
Vantage Bank taps Finzly to modernise payment operations
Texas, US-based Vantage Bank has opted for Finzly’s end-to-end payment hub as it looks to modernise and consolidate its payment processing infrastructure.
The new partnership will see Vantage gain access to instant payments, FedWire, and foreign exchange (FX) services through Finzly’s solution, which also supports rules-based smart routing and customisable workflows, among other features.
“Not only does it streamline the payment process, but it also unlocks valuable data, enabling us to enhance internal automation and respond swiftly to our customers’ evolving needs,” adds Vantage’s chief business architect, Shawn Main.
UK government issues £49m tender for payment services provider to underpin GOV.UK Pay platform
UK government launches search for PSP to underpin GOV.UK Pay
The UK government has initiated a search for a new payment service provider (PSP) to underpin its digital payments platform GOV.UK Pay, with plans to integrate open banking payments into the system.
GOV.UK Pay supports over 1,000 public sector services, including the NHS, police, and local authorities, in processing payments digitally. Since its creation by the UK’s Government Digital Service (GDS) in 2016, the platform has handled over £6 billion across 94 million transactions.
On 19 February, GDS issued a tender notice seeking a PSP to “underpin the GOV.UK Pay platform, specifically for processing credit and debit card payments and pay by bank (open banking) payments made by end users to services operated by local government, police, the armed forces and some other public sector organisations”.
