On 2 December 2025, China and Vietnam officially announced a bilateral QR code payment service in Hanoi, marking a significant step in regional payment connectivity. The initiative enables Chinese consumers to make payments at Vietnamese merchants using the national VietQR system, leveraging China’s mobile payment tools.

The service was introduced by the National Payment Corporation of Vietnam, UnionPay International, the Industrial and Commercial Bank of China and Vietcombank, following a Memorandum of Understanding signed in October 2024 and a subsequent four-party agreement to establish technical connectivity and settlement frameworks.

Key features include:

• Chinese visitors can now scan VietQR at participating merchants, including major retailers, tourist sites and hospitality venues.
• The system aims to increase the use of local currencies in cross-border transactions and support trade, tourism and broader economic cooperation between the two countries.

The launch follows close collaboration under the guidance of the State Bank of Vietnam and marks a significant milestone in strengthening cross-border payment infrastructure.

On 1 December 2025, the New Zealand government announced that Open Banking had officially gone live in New Zealand, marking the first stage of a phased implementation under the Customer and Product Data Act 2025.

The four major New Zealand banks ANZ, ASB, BNZ, and Westpac are now required to have Open Banking systems operational, with Kiwibank scheduled to follow in June 2026 for payment services and December 2026 for other Open Banking functions.

The framework aims to foster innovation and competition by allowing customers to share financial data securely with accredited third parties. Key safeguards include explicit customer consent and accreditation requirements overseen by the Ministry of Business, Innovation and Employment (MBIE), which has introduced a trust mark for approved data requestors.

On 28 November 2025, the Australian Treasury opened a public consultation on a draft Competition and Consumer (Scams Prevention Framework – Regulated Sectors) Designation 2025, which would prescribe banks, telecommunications providers and certain digital platforms (including social media, instant messaging and search services) as the first sectors to be regulated under the new Scams Prevention Framework (SPF) by 1 July 2026.

The SPF, legislated earlier this year, introduces mandatory industry codes of conduct setting out specific obligations for each sector to strengthen scam prevention. Designating the banking sector will make authorised deposit-taking institutions subject to SPF obligations, including proactive anti-scam measures and compliance with SPF principles and any future code. Similar requirements will apply to telcos and major digital platforms.

The Treasury is also seeking feedback on external dispute resolution arrangements, which would involve the Australian Financial Complaints Authority as the single body for unresolved complaints. ASIC, ACMA and ACCC are expected to act as sector regulators for banking, telecommunications and digital platforms respectively.

Submissions on the current consultation remain open until 5 January 2026. The Treasury has also confirmed that future opportunities to comment on sector codes and rules will occur throughout 2026.

On 28 November 2025, the New Zealand Banking Association (NZBA) announced that an update to the Code of Banking Practice introducing new scam protections and a compensation framework for customers had come into effect. The changes target authorised payment scams where individuals are tricked into sending money to criminals and strengthen banks' obligations to prevent and respond to fraud.

The updated Code introduces five key commitments, including: (1) pre-transaction warnings for certain payments, (2) a Confirmation of Payee service, (3) enhanced monitoring and the ability to delay or block high-risk transactions, (4) 24/7 scam reporting channels and (5)  sharing scammer account details between banks to freeze funds where possible. Where a bank fails to meet these commitments, it will compensate all or part of the loss for eligible customers. Banks will also continue to reimburse losses for unauthorised account access.

The NZBA described the changes as a prevention-led approach to tackling scams, emphasising shared responsibility across banks, tech platforms and consumers. The updated Code of Banking Practice is now in force and available on the NZBA website.

On 28 November 2025, the Reserve Bank of India (RBI) published its final guidelines for digital banking channels, setting out new requirements for customer consent, risk controls, and operational standards.

The guidelines require banks to obtain and record explicit customer consent before providing digital banking services and clarify that opting for digital channels cannot be made mandatory for access to core facilities such as debit cards. Banks must implement robust risk mitigation measures, including transaction limits, velocity checks and fraud monitoring and deploy transaction surveillance systems based on risk assessment.

Additional provisions include restrictions on displaying third-party products unless specifically permitted, clear communication of SMS and email alerts for all account operations and ensuring mobile banking services function independently of network providers. RBI also confirmed that stricter requirements from payment system operators will prevail where applicable.

On 27 November 2025, the European Parliament and the Council of the EU issued press releases announcing that they have reached a provisional political agreement on the texts of the proposed Directive on payment services and electronic money services (PSD3) and Regulation on payment services in the EU (PSR). Subject to completion of work on the technical elements of the payments package, payment service providers (PSPs) should expect to see the final texts in the coming weeks.

Take a look at this Our Thinking article for more on this development.

On 5 December 2025, the EBA published a follow-up report to its 2023 report on its peer review on authorisation of payment institutions and e-money institutions under PSD2.

The report covers authorisations between 2022 and 2024, and assesses how supervisors have implemented the 2023 recommendations. It focuses on matters including authorisation processes, implementation of the EBA guidelines on authorisation, and governance and internal controls.

Among the key findings were the following points:

• While most supervisors have improved efficiency by providing clearer guidance, engaging with applicants earlier on and streamlining internal procedures, delays remain as not all changes have had a significant impact; and
• Supervisors report better assessments of applicants' governance and internal control mechanisms, but divergent implementations persist in these areas. This risks creating an uneven playing field and regulatory arbitrage. The report highlights in particular that further efforts are needed to close remaining gaps in anti-money laundering and countering the financing of terrorism controls.

Supervisors are encouraged to address the remaining gaps, and work towards greater convergence in governance and internal control frameworks across the EU.

On 5 December 2025, HM Treasury (HMT) published a policy paper providing an update on creating a provisional licences authorisation regime (part of the government’s March 2025 regulation action plan).

The aim is to reduce the barriers firms face when seeking authorisation by enabling the FCA to grant them time-limited permissions so that they can get "up and running" in a controlled environment with strong regulatory oversight, while working towards full authorisation.

The regime is expected to be most appropriate for early-stage firms, particularly those with an innovative business model, that would otherwise struggle to meet the usual requirements to obtain authorisation in a reasonable timeframe.

Key points from the policy paper include the following:

• The regime is intended for firms that are not already authorised and are seeking permission under Part 4A of the Financial Services and Markets Act 2000 (FSMA) for activities already within the FCA's perimeter.
• The FCA's assessment of applications for provisional licences against the threshold conditions will be proportionate, i.e. its judgements will be tailored to both the firm's stage of development and the fact that the firm has applied for a time-limited authorisation.
• Provisional licences will apply for a fixed duration of up to 18 months. This may be extended in limited circumstances.
• Firms will be required to comply with relevant rules and continue to meet the threshold conditions during the provisional licence period.
• Firms will exit the provisional licence regime on achieving full authorisation.

Introducing a provisional licence regime will require primary legislation, which the government will bring forward when Parliamentary time allows. The FCA will engage with the industry on the design of the regime and consult as necessary.

On 11 December 2025 the Financial Services Regulatory Initiatives Forum, which includes the FCA, the Bank of England (BoE), the PRA, the Payment Systems Regulator (PSR), The Pensions Regulator and HM Treasury, published the latest edition of the Regulatory Initiatives Grid.

The Grid sets out the planned regulatory initiatives for the next 24 months and is published twice a year.

Grid items of relevance to payments and digital assets include:

• Overnight safeguarding facilities in the BoE’s RTGS service for non-bank payment service providers (NBPSPs): The BoE is considering offering overnight safeguarding facilities to FCA-authorised NBPSPs, including e-money and payment institutions, that hold a Real-Time Gross Settlement (RTGS) settlement account. The Grid entry explains that allowing NBPSPs to safeguard client funds in RTGS could help to enhance growth opportunities and innovation by levelling the playing field in the payments ecosystem between commercial banks and NBPSPs. It could also provide benefits to operational risk and financial stability. Any benefits will be evaluated relative to the potential risks from increased NBPSP access to the BoE’s balance sheet as well as the implications for monetary and financial stability. Industry engagement is ongoing and expected to complete by the end of 2025. The BoE then expects to communicate the outcome of its policy decision, including any next steps for implementation, in H1 2026 (marked for Q1 2026 in the indicative timeline in the Grid).
• Contactless payment limits: Final standards following the FCA’s September 2025 consultation are expected in Q4 2025.
• Changes to safeguarding requirements for payments and e-money institutions: In addition to the main timing of May 2026 for the coming into effect of the FCA’s new rules under its Supplementary Regime (which remains unchanged), the Grid also mentions that the Financial Reporting Council (FRC) is developing a safeguarding assurance standard. The FRC started monthly working group meetings in September 2025 which will run until April 2026, with a view to developing proposals for consultation in H2 2026 (marked for Q2 2026 in the indicative timeline in the Grid), and publication of the final assurance standard in H1 2027.
• PSR market review of card scheme and processing fees: A provisional decision on remedies is expected from the PSR in December 2025, with the consultation period planned for December 2025 to February 2026. A final decision on remedies will be due in May to June 2026.
• PSR market review of cross-border interchange fees: A PSR final decision on remedies following the market review is planned for January to June 2027 (ie H1 2027).
• Authorised Push Payment (APP) scam prevention: Publication of the independent 12-month evaluation of the PSR’s APP fraud policies is due in Q3 2026.
• National Payments Vision (NPV) implementation: The Payments Forward Plan is now due in Q1 2026 rather than Q4 2025. Retail Payments Infrastructure Board set up and design consultation is planned for Q1 2026. Delivery Company set up is due in H1 2026.
• Modernising payments assimilated law: Milestones are to be set out in the NPV’s Payments Forward Plan (Q1 2026).
• Managing the failure of systemic digital settlement asset firms: This is now in the Grid’s Annex of completed or discontinued initiatives. The commentary states that HMT continues to develop this initiative and is considering next steps.

In addition, on 10 December the FCA and the PRA published letters to the government (dated 9 December 2025) providing updates on their work during 2025 to support the government’s pro-economic growth agenda.

The FCA’s letter contains an Annex listing the actions taken this year to progress the growth commitments that it made in a letter to the government in January this year. Points of interest from the letter and a related press release include:

• The FCA’s 2026 supervisory approach will reflect a ‘bolder risk appetite’ in support of growth, although it suggests that a ‘clearer articulation of the Government’s risk appetite with metrics would help anchor this shift and support innovation and growth’.
• Stablecoin payments are a particular priority for 2026. There is reference in the press release to the fact that the FCA is inviting firms that plan to issue a stablecoin in the UK and wish to test their products in its regulatory sandbox to apply by 18 January 2026 (see the separate item on this development under ‘Regulatory Developments: Digital Assets’). The FCA also points out that it is working closely with the Bank of England to develop the regulatory regime for stablecoins.

The PRA’s letter provides a brief update on the five pro-growth changes that it intended to make to its regulatory regime and the three proposals for it to explore jointly with HMT and the Department for Business and Trade in 2025.

On 3 December 2025, the Central Bank of Nigeria (CBN) issued a circular introducing sweeping changes to its cash management policies to curb cash dependency and tackle security and money-laundering risks.

With effect from 1 January 2026, individuals will be limited to cumulative weekly withdrawals of ₦500,000, while corporates will be capped at ₦5 million (around US$346 and US$3,438, respectively). The circular also confirms the removal of fees on excess deposits as part of broader efforts to reduce reliance on cash and strengthen compliance across the financial system.

The revised policies apply to banks and other financial institutions and form part of the CBN's strategy to mitigate risks associated with large cash transactions. 

The Public Authorities (Fraud, Error and Recovery) Act 2025 received Royal Assent on 2 December 2025.

The Act includes powers for the Minister for the Cabinet Office and the Department of Work and Pensions (DWP) to issue ‘account information notices', ‘general information notices', ‘further information notices' and ‘direct deduction orders' to banks and e-money institutions (EMIs) in relation to recovery of fraudulent or erroneous payments from accounts, as well as a DWP power to issue ‘eligibility verification notices' to banks and EMIs regarding the checking of eligibility criteria for certain State benefits. There will be fines (including daily default fines) for no, incorrect or late compliance with the new requirements.

Banks and EMIs face material implementation costs and risks of reputational harm once the relevant provisions of the Act enter into force in accordance with secondary legislation yet to be introduced.

For more on the Act, see this Our Thinking article.

On 28 November 2025, the Department for Business and Trade (DBT) published a report examining how existing data standards can support future smart data schemes and setting out nine design principles for new standards.

The report highlights that while data standards are essential, success will also depend on factors such as customer consent, accreditation and data security. It stresses the need for interoperability to avoid fragmentation and maximise benefits. The DBT's research found that data standards already exist in priority sectors including finance, energy, property and retail, but significant work is required before these can fully support smart data schemes.

The report also proposes nine design principles, including clearly defined objectives and guidance on who should create standards, how they should be developed and what they should contain.

As reported in the August 2025 edition of this Newsletter, in August this year the Competition and Markets Authority (CMA) consulted on its proposed decision that the limitation on bundling provisions in the 2002 small and medium-sized enterprises banking undertakings (SME Undertakings), which are the only provisions in the undertakings that remain in force, is no longer appropriate and should be released.

Following the consultation, on 1 December 2025 the CMA confirmed that proposed decision and gave notice of the release of the SME Undertakings.

On 2 December 2025, the Treasury Committee published an update from the FCA on its review of the access to cash regime.

In the update, the FCA states that it will start the review in Q4 2026 (two years after the rules took effect) as part of its commitment to ongoing monitoring of the regime's effectiveness. It will publish the review findings in Q2 2027.

The review will involve a qualitative and quantitative assessment of the regime, but the exact scope and methodology is yet to be determined. The update includes examples of the questions the review will consider and the key quantitative data points that may inform the review.

The FCA acknowledges that there will be some limitations to the review findings. For example, the review will not directly assess cash acceptance, as the FCA's powers relate to access to cash and it does not collect data on, or have oversight of, cash acceptance.

The FCA notes that, in the first year since the rules came into force in September 2024, 121 banking hubs and 93 cash deposit services (such as ATMs and Post Office counters) have opened.

The FCA is currently undertaking targeted work looking at cash access outcomes in rural areas in response to feedback.

On 9 December 2025, the FCA published a consultation paper (CP25/37) on ‘Targeted clarifications of Handbook materials’. The consultation is part of the FCA’s Consumer Duty Requirements Review (CDRR). It follows its July 2024 Call for Input (CFI) on its conduct rules, and is part of the workplan announced in its March 2025 Feedback Statement (FS25/2). The FCA reiterates that it wants to simplify its requirements by relying more on high-level rules, while ensuring it continues to support and protect customers. The proposals also support the priorities set out in the FCA’s Strategy 2025-2030.

The FCA is asking for views on a number of proposals including:

• Smaller Firms Guide: The FCA is seeking views on its approach to creating a smaller firms guide and inviting industry views on where firms have an unmet need in understanding its requirements and how to meet this need.
• Clarifying references to Principles 6 and 7: There are proposals to amend references to Principles 6 and 7, now that the Consumer Duty has been introduced. The FCA also considers references to ‘treating customers fairly’ which is rooted in Principle 6 and the treatment of related non-Handbook materials that are still accessible on its website.

The consultation closes on 27 January 2026.

Most of the proposed rule changes would come into force immediately after they are made in the FCA’s policy statement. The FCA anticipates that this will be in Q2 2026.

There is further information on the progress that the FCA has made in delivering its Requirements Review workplan on its website, including its future priorities following engagement with stakeholders.

In addition, on 8 December 2025 the FCA published a statement aimed at clarifying its supervisory expectations to help firms interpret the Consumer Duty where they work together to create products and services. The FCA intends to build on the approach outlined in the statement in 2026, when it plans to review and consult on amendments to the rules.