Select committee: Treasury Committee
Recommendation 9
First Report - The digital pound: still a solution in search of a problem?
Published 2 Dec 2023
Paragraph 53
Addressed to HM Treasury
Treasury Committee The crypto-asset industry All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
The Government and Bank of England must resist the temptation to believe that a digital pound can fix problems it can’t, however, and a digital pound must not make financial exclusion worse. There is a risk that the introduction of a digital pound accelerates the demise of physical cash, causing difficulties for those currently reliant on it. It is vital that efforts continue to be made to support those reliant on physical cash. It is also vital that the Government works to improve digital literacy and inclusion in the UK. The Government and regulators must ensure that any future digital pound wallet providers grant access to at least basic digital pound services for all UK adults.
From: Treasury Committee, First Report - The digital pound: still a solution in search of a problem? (HC 215), paragraph 53, 2 December 2023
Government response
The government responded to the whole report on 31 January 2024 (deadline 1 February 2024).
Summary written by Accountability Index from the government's response. It is not the government's own words.HM Treasury and the Bank of England say that no decision has been taken on whether to introduce a digital pound, and that the design phase will inform a decision "later this decade".
- On privacy, they "agree that strong privacy safeguards would be vital" and say the Government "has committed to guaranteeing users' privacy in primary legislation if a digital pound were launched".
- On interest, they do not commit to further analysis or to keeping the option open: a digital pound "would be unremunerated at launch", and any later change would be "preceded by a review with full consultation".
- On costs, the Bank "acknowledges" the request for a separate line item and says it "will consider the appropriate reporting mechanism going forward".
- On holding limits, they are "minded to proceed at this stage" with a £10,000 to £20,000 limit, "at least during the introductory period", while remaining "open to revisiting the bounds of this range if new information came to light".