A group of seven major UK banks has successfully carried out live retail transactions using tokenised sterling deposits, testing programmable bank money across mortgage and consumer-payment use cases.
The trials were conducted through the Great British Tokenised Deposit initiative led by UK Finance and involved Barclays, HSBC UK, Lloyds Banking Group, Monzo, Nationwide, NatWest and Santander. Tokenised deposits represent conventional commercial bank money in digital form, with additional functionality that allows payments to be programmed around specific conditions.
Two of the live transactions involved remortgage completions. The technology allowed funds to be locked before being automatically released when completion requirements were satisfied, potentially reducing manual processing and settlement friction.
A third transaction involved an online marketplace purchase between private individuals. In that case, the buyer’s money remained locked until the exchange of goods was completed, illustrating how programmable deposits could be used to manage counterparty risk in digital transactions.
The trials were executed using infrastructure developed by Quant. UK Finance said tokenised deposits could eventually support applications ranging from faster property transactions and safer online payments to digital-asset trading and more efficient financial settlement.
Further testing is expected over the next few months, including digital-asset settlement experiments in which tokenised customer money would be exchanged against digital securities. The initiative reflects growing interest among traditional banks in applying tokenisation technology to regulated financial infrastructure.
