UK Government Looks to Blockchain Trials for Welfare Payments

Executive Brief

One of the key challenges for the digital currency industry is to gain acceptance by the wider audience, including private citizens, businesses and governments. With the announcement that the UK government are trialing a blockchain powered payment solution for the country’s welfare system suggests that for blockchain at least this barrier is being eroded. In partnership with banking giant Barclays and startup GovCoin, along with University College London and energy firm RWE, the new trial will reveal the suitability of blockchain for welfare payments and its effect on the recipients of such payments longer term.

Read the full story below. 


In one of the first programs of its kind anywhere in the world, the Department of Work and Pensions, The UK government’s office responsible for welfare and social payments, is set to trial a new payment system built upon a blockchain infrastructure. In partnership with UK based banking giant Barclays, a Fintech startup GovCoin, the UK office of German Energy firm RWE and University College London, the new trial project will be operated in a small scale in the North West of the country to ascertain its suitability for the application.

The system will be evaluated not just on its ability to deliver the payments reliably, but on the impact of the recipients of those payments and how the process affects those people overall. The Minister for Welfare Reform, Lord Freud, noted that “Claimants are using an app on their phones through which they are receiving and spending their benefit payments. With their consent, their transactions are being recorded on a distributed ledger to support their financial management.”

The secure data that the distributed ledger data represents could prove invaluable in reassessing the effectiveness of welfare payments and the relationship between recipients and the government, although the more detailed information about the structure of the system itself are currently being kept in-house.

It is an interesting development for the industry as a whole, not just for the potential impact of government systems running wholesale on blockchain infrastructure may have on it, but for the way in which blockchain, the foundation of digital currency, is now being used to analyze and power fiat money payment systems. In both instances, it represents added interest in the cryptocurrency industry and brings potentially significant influence across the social structure for people in receipt of all kinds of government funding. That major western government is implementing trials such as this suggests a very healthy future for blockchain and the industry, but there is also clearly a lot of work to do for the digital currencies themselves to match this kind of acceptance.


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Author: Nick Marinoff

Nick Marinoff is a freelance author, writer and journalist. His first book, "Take a 'Loan' Off Your Shoulders: 14 Simple Tricks for Graduating Debt Free" is now available on He is currently a lead content writer and news editor for Money & Tech, and is a regular contributor to both NewsBTC and Other publications include Black Impact Magazine, and The Loan Gurus, to name a few. He is a proud graduate of FHSU in Hays, KS.

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