This consultation was open for response until 30 June 2023. The Bank of England and HM Treasury published a response to this consultation paper on 25 January 2024.
Overview
A Bank of England and HM Treasury publication
The way we use money is changing. This Consultation Paper sets out our assessment of the case for a retail central bank digital currency (CBDC) – a so-called ‘digital pound’. It has been overseen by the joint Bank-HM Treasury CBDC Taskforce that was announced in April 2021.
At this stage, we judge it likely that the digital pound will be needed in the future. It is too early to decide whether to introduce the digital pound, but we are convinced preparatory work is justified.
A digital pound would be a new form of sterling, similar to a digital banknote, issued by the Bank of England. It would be used by households and businesses for their everyday payments needs. It would be used in-store, online and to make payments to family and friends. If introduced, it would exist alongside, and be easily exchangeable with, cash and bank deposits.
A digital pound would maintain public access to retail central bank money and, as our lifestyles and the economy become ever more digital, it would also promote innovation, choice and efficiency in domestic payments.
During this consultation, HM Treasury and the Bank of England engaged extensively with stakeholders across the UK to seek views on the proposed model of the digital pound set out. Responses to this consultation were invited from all interested members of the public, experts, and organisations.
The digital pound: A new form of money for households and businesses?
Alongside the Consultation Paper, the Bank of England published a Technology Working Paper outlining emerging thinking on CBDC technology.
In March 2023, UK Finance and Innovate Finance hosted the Bank of England at a webinar to discuss the Consultation Paper. In this webinar, the Bank outlined the key messages of the paper, followed by a Q&A session.
