The Bank of England is launching two working groups for offline payments and retailer needs as part of its central bank digital currency (CBDC) exploration. It published requests for information (RFI) from experts (suppliers) on these digital pound topics, asking for responses by September 3.
The working groups are separate from the CBDC Engagement Forum, but the groups’ work output might be shared with the Forum. In addition to the Engagement and Technology Fora, the Bank is also launching an Academic Advisory Group and invited applications by September 3.
Regarding the RFI, for offline payments the Bank wants to know if it’s feasible for a CBDC, what risks exist, and how then can be mitigated. It also wants to know about use cases for financial inclusion and other areas. Finally it wants to know if it should be part of the core digital pound design. Separately, the BIS published a book on the topic!
For retailers it wants to find out what factors will motivate merchants to accept the digital pound. It also wants to know the options for in-store payments, their pros and cons, as well as how to enable e-commerce payments.
In contrast, the European Central Bank conducted a market survey of suppliers, although it was partly to establish the potential costs. In the digital pound case, competitors have to work together, as they do in the CBDC Technology Forum.
Meanwhile, last month the Bank of England Governor Andre Bailey urged banks to also progress work on tokenized bank deposits.