(Bloomberg) -- Bank of England Deputy Governor Sarah Breeden said the UK is on the cusp of a technological revolution in finance that will slash the cost of using money, and allow micropayments and automatic payments on the delivery of goods.

Breeden said on Monday that “urgent action” is needed to prepare the UK finance sector for a “widespread, more fundamental technological change” that may lead to a wave of new players threatening traditional banks.

The UK central bank is preparing for a step change in the way Britons use money, including designing a central bank digital currency, known as “Britcoin,” and regulation for stablecoins.

While payments innovation may “offer significant benefits for customers and businesses, economic activity and growth,” Breeden said in a speech at the Innovate Finance Global Summit that there are also risks. Those could come from new players that “quickly get to systemic scale” if traditional finance fails to innovate.

She highlighted examples of how nascent technologies could transform payments for consumers and firms. It will allow automatic payment from customers once goods have been delivered and instant refunds for rail commuters when their train is late. 

These technologies — which are set to slash the cost of retail payments — could also make micropayments economical, allowing for a reader to pay for just one article rather than needing an newspaper subscription.

“The pace, breadth and depth of technological change we see now suggests even more radical change may be ahead of us,” she said. “I am firmly of the view that the technology revolution will hit – indeed, is hitting – finance in the way that it has hit other sectors of the economy.” 

A BOE discussion paper on payments innovation and ensuring they are safe will be published in the summer, Breeden said.

She said that stablecoins — a cryptocurrency whose value is tied to an underlying asset — still remain a threat despite Facebook’s Libra project coming to “naught.”

“The possibility of stablecoins coming to be used at scale for retail payments (including by harnessing large firms’ existing user bases) remains,” she said. Respondents to a discussion paper proposing a regulatory regime for stablecoins warned the BOE that its rules could smother the sector, and “effectively bar use of stablecoins at systemic scale.”

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