The Bank of England and HM Treasury have published a consultation paper on the potential introduction of a retail central bank digital currency (CBDC), also known as a ‘digital pound’. The paper discusses the need for a digital pound in the future and highlights its potential benefits for households and businesses, such as convenience and innovation in domestic payments. The digital pound would coexist with cash and bank deposits, maintaining public access to retail central bank money. The Bank of England is seeking views and responses from various stakeholders, including the general public and experts, to inform their future work on this initiative.
| Signal | Change | 10y horizon | Driving force |
|---|---|---|---|
| Consultation on retail central bank digital currency | Shift from physical to digital form of currency | Increased use of digital currency | Promoting innovation and efficiency |
| Potential introduction of digital pound | Coexistence of digital pound, cash, and bank deposits | More options for everyday payments | Advancing digitalization of the economy |
| Use of digital pound for payments to family/friends | Expansion of digital payment options | Greater convenience in personal transactions | Meeting evolving payment needs |
| Consultation to seek views on proposed model | Engagement with stakeholders for feedback | Informed decision-making process for digital pound | Ensuring public input and transparency |
| Technology Working Paper on CBDC technology | Exploration of technological aspects of CBDC | Development of advanced digital currency systems | Advancing digital infrastructure and security |