Listen to our payments podcast on the FCA’s review on risk management and wind-down planning at e-money and payments firms.
UK
BNPL
- FCA begins consultation for incoming BNPL regime: The FCA is consulting on the rules which will apply to buy-now pay-later providers. Following on from legislation to bring more BNPL agreements into the scope of the Consumer Credit Act, the consultation proposals require BNPL providers to provide upfront and additional product information, alert and support customers on missed payments, report to the FCA, and comply with the Consumer Duty. The consultation closes on 26 September 2025, with finalised rules expected from the FCA in early 2026 and the BNPL regime to take effect from 15 July 2026.
Read our blogposts:
FCA shapes rules for BNPL at start of one year countdown to new regime
The Consumer Duty and BNPL – uncomfortable accommodation or a meeting of minds?
Payments
- FCA criticises e-money and payments risk management: The FCA has urged UK payments firms to strengthen their compliance arrangements after a review revealed weaknesses in risk management and wind-down planning across the sector. In a multi-firm review of 14 payment and e-money institutions, the FCA found that none fully met its expectations, particularly around identifying material risks, monitoring liquidity, and considering group dependencies. While these findings do not introduce new rules, they clarify existing expectations and share good practice from within the sector. Payment firms are encouraged to test their processes against FCA standards and address any gaps promptly.
Read our blogpost: FCA criticises how e-money and payments firms manage risk
- Leeds Reforms delivers update on National Payments Vision: The newly created Payments Vision Delivery Committee – including HM Treasury, the Bank of England, the FCA, and the Payment Systems Regulator – will publish its strategy for retail payments infrastructure in the autumn. The Committee will be supported by a Retail Payments Infrastructure Board and an industry-led Delivery Company. The Committee will also publish a Payments Forward Plan by year-end.
Read our blogpost: One step closer to the next generation of UK retail payments infrastructure
- UK finalises Fundamental Rules for FMIs: The Bank of England has finalised its Fundamental Rules for financial market infrastructure. Having originally proposed a six-month implementation period; the Bank has now given FMIs until 18 July 2026 to prepare for these new requirements.
Read our blogpost: FMIs given one year to put fundamental rules into practice
- Bank of England consults on longer RTGS and CHAPS operating hours: The Bank of England has published a consultation paper with proposals to extend the settlement hours of the RTGS system and extending the CHAPS operating hours. The key proposal is to open CHAPS for settlement from 1:30am for both urgent and non-urgent payments, targeted for implementation in the second half of 2027. The consultation also seeks feedback on expanding the CHAPS contingency window and allowing RT2 settlement during certain bank holiday weekends. The consultation closes on 21 October 2025.
Digital assets
- FCA opens retail access to crypto ETNs: In Handbook Notice 132 the FCA announces that its Conduct of Business (Cryptoasset Products) Instrument 2025 will come into force on 8 October 2025. The instrument will allow firms to give retail consumers access to crypto exchange traded notes. This follows a consultation (covered in our July 2025 update) which proposed lifting the ban on retail access to these products. The FCA notes that the ban on retail access to cryptoasset derivatives remains in place.
General
- Leeds Reform introduces Wholesale Financial Markets Digital Strategy: HM Treasury has unveiled a strategy to accelerate the digitalisation of the UK’s wholesale financial markets. Key commitments include eliminating paper from wholesale transactions, transitioning to a next-day (T+1) securities settlement cycle by October 2027, enabling tokenisation of financial assets, and appointing a Digital Markets Champion. The Digitisation Taskforce, led by Sir Douglas Flint, has published its final report. The government has accepted all its recommendations, including ending paper share issuance from 2027 which will be implemented through new legislation. Additionally, HMT has confirmed that the Digital Gilt Instrument pilot will test on-chain settlement for transactions and allow settlement of over-the-counter trades.
Read our blogpost: UK uses “Leeds Reforms” to rewire financial system
EU
Operational resilience
- EU finalises DORA framework: The EU has completed the DORA framework with the addition of rules on subcontracting and threat-led penetration testing (TLPT). The regulatory technical standards in both areas are unchanged from the Commission drafts published earlier this year. The rules on subcontracting took effect from 22 July 2025 whilst the TLPT standards are enforceable as of 8 July 2025.
Read our blogpost: Final pieces of DORA rulebook fall into place
AI
- Commission gives guidance on general purpose AI: The European Commission has published guidelines on general purpose AI under the EU AI Act. The guidelines seek to clarify when AI is a GPAI model. They also note that a GPAI model developed and made available outside the EU will be subject to the EU regime when an AI system that integrates the model is also placed on the EU market. Rules on GPAI under the AI Act started to apply on 2 August 2025.
AML
- EBA warns of weak compliance controls in the fintech sector: The European Banking Authority has used an opinion to note significant changes in the risk landscape for money laundering and terrorist financing. The EBA’s findings suggest that the financial sector's drive for innovation and growth may be outpacing its ability to manage ML/TF risks, with payment institutions and e-money sectors particularly exposed. For example, the EBA suggests that some fintechs prioritise growth over compliance. The EBA also raises concerns about how financial institutions can keep pace with criminals’ use of AI.
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