Tokenisation Moves Up the Agenda for UK Financial Institutions as Investment Accelerates

Tokenisation is moving rapidly from experimentation towards mainstream financial infrastructure, with Lloyds’ latest Financial Institutions Sentiment Survey showing growing conviction that digital assets will materially change how money and securities move.

Tokenisation Moves Up the Agenda for UK Finance

Lloyds’ research says 71% of senior leaders expect tokenisation to reshape financial services. The underlying survey provides a more detailed measure: 41% expect its impact to be significant or transformational, comprising 30% anticipating a significant effect and 11% expecting outright transformation.

The distinction is useful. Financial institutions appear increasingly convinced tokenisation matters, but most see it as an evolution of existing market infrastructure rather than its wholesale replacement.

Payments and Settlement Offer the Clearest Opportunity

The strongest use cases are also becoming clearer.

Some 60% of respondents identify faster payments and settlement as the leading benefit of tokenisation, followed by collateral and liquidity management at 41%. Tokenised deposits and cash instruments rank closely behind at 39%.

For banks and institutional clients, these are potentially substantial gains. Bringing cash and securities onto compatible digital infrastructure could allow assets and payments to move simultaneously, reduce settlement risk and release liquidity that would otherwise remain tied up while transactions complete.

Programmability adds another layer, enabling transactions to execute automatically when predefined conditions are satisfied.

Technology Becomes the Number One Growth Lever

Tokenisation forms part of a much broader acceleration in technology spending.

Investment in new and emerging technologies has become the leading growth priority for UK financial institutions, cited by 77% of respondents, compared with 41% in 2025. Expansion within existing markets rose from 47% to 60%, while the proportion prioritising data and insights more than doubled from 24% to 53%.

That suggests the industry is moving beyond defensive technology modernisation towards using infrastructure investment as a source of growth.

Lloyds itself has been testing this transition through work involving tokenised deposits and securities, including transactions designed to demonstrate how commercial bank money can settle digital assets.

The Challenge Now Is Infrastructure at Scale

The harder stage comes next. Individual tokenisation projects can demonstrate faster settlement or more efficient collateral movement, but widespread adoption depends on interoperability between digital platforms and established financial systems.

The survey describes tokenisation as moving from theoretical promise towards identified, practical applications, while Lloyds argues the key test will be turning those use cases into scalable and trusted infrastructure.

That may prove the defining question for the next phase of digital assets.

The argument for tokenisation is increasingly shifting away from whether blockchain belongs in financial services, towards whether banks can make tokenised money and assets operate reliably across the existing financial system.