How the U.K.'s 5G plan will create a new hub for payments innovation
The U.K. government has committed to a 5G Urban Connected Communities Project for a city-wide trial of 5G wireless technology as part of the fourth phase of the government’s 5G strategy. This trial should spark substantial investment in new payments technology.
U.K.-based firms wanting to test drive next-generation frictionless technologies such as mobile wallets, Amazon Go-style checkout-free shopping and payments optimization should be jumping on board. The results of the experiment will provide valuable and realistic insight into 5G power and flexibility in a complex, but controlled, environment.
Innovators typically see such environments as vital to testing new payments technologies. Visa, for example, uses the Olympic Village as a regular testbed. The 2012 London games were a proving ground for mobile payments on Samsung handsets; and this year's Winter Games in PyeongChang allowed Visa to test wearable payments as well as sensory checkout experiences.
Such projects fit well with the U.K. government's goal to build the economic case for investment in 5G. The project is currently accepting bids from both government and private organizations wanting to be involved, with the winning city expected to be announced by early July 2018 and implementation under way by the end of the year.
5G wireless infrastructure, with its faster speeds and lower latency, promises to offer many benefits. The government cites services such as doctor-patient video consultations and remote treatments, real-time public transport monitoring and the use of augmented reality and robotics in assembly lines.
It's also a viable counter to the fears that the Brexit vote would drive innovators out of the U.K.
London, a well-established fintech hub, has worked aggressively to reinforce its reputation in the wake of the vote. Last year, for example, a group of 13 London-based fintech companies and seven companies in related industries including venture capital and law came to a conference in the U.S. to promote their visibility to the global payments community. These efforts seem to have paid off — venture capitalists invested a record $2.2 billion in British financial technology companies in 2017, an increase of more than 150% over 2016, according to data from Innovate Finance and Pitchbook.
If London or another city becomes the trial location for the U.K.'s 5G efforts, it should draw fresh interest in the technologies that develop out of the government's project.
This citywide testbed for wireless 5G infrastructure will be funded by a £200 million investment from the National Productivity Investment Fund (NPIF). In November, the U.K. government pledged £500 million for a foray into technology, to support what Chancellor Philip Hammond called a “range of initiatives from artificial intelligence, to 5G and full fibre broadband.”
“This is a huge opportunity for an urban area to become the flagship of our ambitious programme to make Britain fit for the future and a world leader in 5G,” said Digital Minister Margot James in a press release last week.
This month also saw the launch of UK5G, a new national innovation network dedicated to the promotion of research, collaboration and the commercial application of 5G in the U.K.