PEXA has been selected to participate in the Bank of England’s Synchronisation Lab, a programme exploring the use of automatic settlement across sectors including property.
The digital property completions and data business confirmed on 12 February that it will take part in the initiative, which has been established to test use cases for synchronised settlement of funds.
PEXA was chosen to demonstrate how synchronised settlement could operate within residential property transactions. Under the current process, completion is sequential: funds are transferred and the title is lodged with HM Land Registry at a later point. This creates a period during which money has changed hands but legal ownership or charge has not yet been secured.
In practice, that gap can expose both lenders and buyers to legal, financial and operational risk, as funds are released without immediate confirmation of title registration.
PEXA says its platform is designed to link the movement of money and the lodgement of title within a single digital environment. The business operates what it describes as the UK’s only FCA-regulated digital property completion infrastructure and will use the Lab to demonstrate its technology at scale.
The firm said participation would not require additional investment in the UK’s banking infrastructure, with the focus instead on testing how synchronised settlement and title lodgement could improve certainty and transparency in the completion process.
Joe Pepper, UK CEO at PEXA, said: “To be selected by the Bank of England after a rigorous application process is a huge achievement in itself. It gives us an enormous opportunity to showcase the capabilities of the technology we’ve spent significant time and resource building as a bespoke solution for the UK.
“We will demonstrate that it is possible to eliminate property settlement risk without the need to build entirely new, duplicate infrastructure.
“We’re thrilled to be selected, and looking forward to getting started with the support of an expert team.”
The Synchronisation Lab forms part of a wider set of initiatives aimed at modernising the home buying and selling process.
HM Land Registry has outlined its digitisation ambitions in its Strategy 2025+, while the Ministry for Housing, Communities and Local Government recently concluded a consultation on reforms to the home buying and selling process.
Elsewhere, the Open Property Data Association is developing a property data trust framework and participating in a range of data-related pilots.
The Financial Conduct Authority is running an Open Finance tech sprint focused on mortgages, and the Centre for Finance, Innovation & Technology is convening an Open Property Coalition to bring together government and industry stakeholders.
Collectively, these initiatives indicate increasing national focus on creating a more integrated and digital-first property transaction system, with an emphasis on reducing risk and improving outcomes for consumers and market participants.
