Like many other countries, the UK has developed a plan for a central bank digital currency (CBDC). A digital pound would essentially act like an online form of cash suitable for everyday payments. It would not earn any interest like a standard savings account (or even some current accounts), but it could increase access to financial services in the UK.

The Bank of England recently proposed a general framework for how a digital pound would work. It has suggested an ambitious timeline for introducing one by 2025. You have until June 7 2023 to tell the bank what you think of its plan.

The success of a UK CBDC will largely depend on whether the benefits of offering a digital currency outweigh the costs of creating and rolling out the infrastructure needed to support the new payment system.

There are clear benefits to CBDCs, such as increasing financial inclusion by providing an easier way for the UK’s 1.2 million unbanked residents to register for banking services. The online wallets that would hold people’s digital pounds could also be used by the government to make “fiscal transfers” such as passing tax subsidies or support payments on to households and businesses.

But the Bank of England’s current proposal is also seeking answers to some questions about a digital pound. In particular, how (or if) it could coexist alongside other digital currencies such as cryptocurrency assets. While the bank suggests several models, broadly speaking this could help reduce systemic risk in the crypto sector and further increase banking options for UK consumers.