UKGlobal
7 November 2024
April 29, 2024
Positive Money’s new report, ‘The Fiscal Benefits of a Digital Pound’, finds the introduction of a central bank-issued digital pound could bring in around £30 billion extra every year to boost government spending, depending on the level of adoption.
A £20 note doesn’t cost £20 to make. The difference is something called ‘seigniorage’. Back when cash was king, the Bank of England used to make huge profits from seigniorage and because the Bank was publicly owned, all that money went to HM Treasury and could be used to fund public spending.
But decades of deregulation in private banking plus the growing popularity of digital payments mean that right now it’s big banks that are reaping the profits from money creation. There is a public alternative: a central bank-issued digital pound.
⚡ BREAKING ⚡
Our latest research finds more than £30 billion for public spending each year could come from a very unexpected place:
A central bank-issued digital pound!
That’s enough to fund a certain green investment pledge 🙃
Let us explain…🧵 pic.twitter.com/2YKMyRjqLt
— Positive Money (@PositiveMoneyUK) April 29, 2024
A digital pound – as a complement not a replacement for physical cash – could give the government up to £30 billion every year. That could cover a pay rise for NHS staff, help fix crumbling schools, or fund a certain political party’s green investment pledge…
Today, most of the money in our economy is digitally created by banks when they make loans, and it’s destroyed when those loans get repaid. A public digital pound could redirect billions of pounds from seigniorage back into the public purse, and help us claw back power from the big private banks.
A public digital pound is exactly the kind of change Positive Money was founded to fight for; to win a money and banking system that works for people, not profit. Click here to read our new report in full.
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