The Bank of England (BoE) is set to launch a public consultation to explore alternative retail payment methods that bypass traditional debit and credit card networks, reported Reuters.
The consultation is planned for the spring.
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Ahead of that, the BoE is creating panels to take evidence from stakeholders both inside and outside the financial sector.
Deputy Governor Sarah Breeden said the central bank wants to widen choice for shoppers.
“We want UK consumers to have the option to pay retailers in-store or online directly out of their bank accounts as a complement to doing so via card schemes,” she said in a speech on Monday.
Cash now accounts for under 10% of payments in Britain, while debit and credit cards make up almost two thirds of transactions, highlighted the news agency.
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By GlobalDataThis leaves US payments giants Mastercard and Visa as key intermediaries in everyday spending.
In November, the finance ministry and the BoE set out a retail payments infrastructure strategy that aims to encourage banks and other financial firms to jointly develop more payment options for consumers.
Breeden said more competition could ease fees for smaller retailers, which typically face charges around four times higher than the largest chains, and improve resilience to cyber incidents and other disruptions.
Speaking at a conference hosted by City & Financial Global, Breeden was asked whether the UK approach reflected sovereignty and security concerns seen elsewhere in Europe.
She did not address this directly but said: “if you’ve got more than one way to pay at point of sale, in the rare event of an operational disruption, you’re best able to continue to have economic activity.”
According to her, the strategy will also consider how existing money formats would interact with any future stablecoins or a possible BoE digital currency, and how to cut the cost of cross-border payments.
Breeden added that new options are unlikely to replace cards entirely, noting that in markets such as Sweden, India and Brazil, multiple payment methods operate side by side, as per the report.
