Minutes
Date: 17 January 2024
Item 1: Welcome
Co-chairs Gwyneth Nurse and Sarah Breeden welcomed Members to the sixth meeting of the CBDC Engagement Forum (the Forum), including those attending their first meeting of the Forum.
Sarah Breeden noted she was co-chairing the Forum for the first time, having replaced Jon Cunliffe as Deputy Governor for Financial Stability.
Item 2: Working group presentations: Retailer Needs and Offline Payments
The Bank reminded the Forum of the aims and objectives of working groups noting the importance of their role in providing expertise on topics and the value of working groups presenting to the Forum for wider discussion. Two industry-led working groups had been established to date and had recently met for the first times. The leads of those working groups presented their initial views on scopes and plans for the groups to the Forum:
Retailer needs (Simon Coles, Paypoint)
Simon Coles updated the Forum on the membership and objectives of the Retailer Needs working group, including the questions set by the Bank/HMT in the Request for Information (RFI). He set out the approach the group intended to take, including the establishment of sub-groups to address specific questions in the RFI. He noted that the group would take specific steps to mitigate the potential for bias towards large retailers. The group had held two meetings to date to discuss the scope of its work as well as timelines and milestones. It aimed to conclude its work by September 2024.
Simon raised that the group would do some time-limited work on consumer preferences in retail settings as the group felt this is a necessary input into the work. He also noted that the group could see that there could be links with the work of the offline working group.
In discussion, some members raised links with concurrent Government initiatives in the payments sector. Members highlighted the importance of understanding consumer preferences in general given that payments is a two-sided market, and noted the importance of how retailers would convert between digital pounds and commercial bank money.
The co-chairs acknowledged the various interactions that had been raised but encouraged the working group to keep a tight scope in order to ensure that the work remained manageable.
Offline payments (Abbas Rana, HSBC)
Abbas Rana presented on the Offline Payments working group, setting out the membership and the questions posed in the RFI. He summarised some of the key principles identified in relation to offline payments and noted the group’s intention to initially explore the customer experience. The group had held two meetings to date and was aiming to report back to the Forum by July 2024.
In discussion, some members noted how the approach to offline payments was determined by decisions on the type of CBDC. Members noted examples of work elsewhere that could usefully inform this group, and noted links with the work of the Retailer Needs working group, including how offline payments might work in store.
Item 3: Future working groups
HMT presented on the proposed pipeline of four additional working groups, expected to be launched over the course of 2024: on privacy, intermediaries, interoperability, and consumer protection. They noted that there was likely to be a degree of overlap between the work of the groups in some areas.
Members discussed the likely overlap between different groups (for example, the Retailer Needs group would consider the possible role for retailers as intermediaries). The Bank and HMT steered that the working groups should highlight where there are dependencies between topics, but do not need to try to coordinate across groups.
Members discussed and reached consensus that Requests for Information (RFIs) should be launched for four additional working groups as set out by the Bank and HMT.
Members discussed the importance of regulation and scheme rules, both in the context of consumer protection but with cross-cutting significance. Members raised the importance of establishing strong anti-fraud protections, addressing the question of competition within the digital pound ecosystem, and learning from other initiatives. On interoperability, members suggested it was important to clarify whether this would include international as well as domestic interoperability. Some members noted that they felt consumer protections would be critical to ensuring consumer confidence in the digital pound, and this work could be informed by further research into consumer attitudes.
Items 4: AOB
Gwyneth Nurse closed the meeting and thanked members for their participation.
In response to a member query, she noted that the Forum would need to keep abreast of related policy initiatives including those led by industry – HMT and the Bank would take this away and consider how this could be achieved.
Attendees
Sarah Breeden (co-Chair) - Bank of England
Gwyneth Nurse (co-Chair) - HM Treasury
Neeraj Patel, HM Treasury
Tom Mutton - Bank of England
Katie Fortune - Bank of England
Members
Adam Jackson, Director of Policy, Innovate Finance
Anne Boden, Board member and Former CEO, Starling Bank
Bryan Zhang, Executive Director, Cambridge Centre for Alternative Finance
Chris Rhodes, CFO, Nationwide Building Society
David Grunwald, Group Director of Innovation & Partnerships, NatWest
Etay Katz, Partner, Ashurst LLP
Fran Boait, Co-Executive Director, Positive Money
Harry Newman, Head of Market Initiatives EMEA, SWIFT
Jana Mackintosh, Managing Director Payments & Innovation, UK Finance
Martin McTague, National Policy Chair, Federation of Small Businesses
Mick McAteer, Founder and co-Director, The Financial Inclusion Centre
Natasha de Terán, Member of the Financial Services Consumer Panel
Paul Bances, Head of Global Market Development of Blockchain, Cryptocurrency, and Digital Currencies, PayPal
Ruth Wandhöfer, Member, PSR Panel
Simon Coles, CTO, PayPoint
Simon Gaysford, Founder & Director, Frontier Economics
William Chalmers, CFO, Lloyds Banking Group
Non-members
Abbas Rana, Director, Head of Product Management, Group Liquidity and Cash Management, HSBC
Apologies
Arunan Tharmarajah, Head of European Banking and Payments, Wise
Arvin Abraham, Partner,Goodwin Procter
Charlotte Hogg, CEO, Visa Europe
Colin Bell, CEO, HSBC Europe
Diana Layfield, President EMEA Partnerships, Google
Hannah Regan, Financial Policy Lead, British Retail Consortium
Jorn Lambert, Chief Digital Officer, MasterCard
Kate Frankish, Chief Business Development Officer, PayUK
Nabil Manji, Senior Vice President, Head of Crypto & Web3, Worldpay
Neha Narula, Director of the Digital Currency Initiative, MIT
Reema Patel, Research Director, Ipsos UK
Simon Gleeson, Partner, Clifford Chance
Tracey McDermott CBE, Group Head, Conduct, Financial Crime and Compliance,Standard Chartered Bank