Existing UK POS Terminals Can Be Used to Initiate Digital Pound Payments

The Bank of England recently conducted research to determine whether it would be necessary to install new Point-of-Sale (POS) terminals to initiate digital pound payments. However, the study determined that the existing terminals would not be needed and should work with the digital pound.

Merchants Won’t Need To Buy New Hardware To Enable Digital Pound Payments

The Bank of England has spent a long time researching the digital pound, and exploring potential use cases and the need to develop a central bank digital currency (CBDC). This year, it finally took a step forward, moving on to the design phase.

However, the UK has decided that the digital pound, as well as any other future CBDC that might be accepted in the country down the road, needs to be useful in everyday life. That means allowing users to make everyday in-store payments.

With this being the case, a question emerged: Can the existing POS terminals be modified to accept CBDC payments, or would a new version have to be made and acquired by the local merchants?

This led the bank to conduct a feasibility study to find the answer, but fortunately, the results revealed that there is no need for merchants to invest into new hardware in order to conduct CBDC payments. In other words, that is one more obstacle removed to introducing the digital pound into the UK economy.

Existing POS Can Allow For The Implementation of Offline Payments Functionality

According to the bank’s study, the existing POS terminals can initiate digital pound payments, but in addition to that, the researchers also deduced that it is possible to implement offline payment functionality. However, this is currently only possible in theory, as the machines would require modification to enable that.

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Still, the possibility exists, and all it would take is slight modifications. This is because the functionality might require that an offline payments application be deployed to those terminals to store offline balances.

The bank’s statement said that the BoE did not build a digital pound infrastructure for the experiment and that no real money payments were made. However, despite this, the experiment was successful.

The bank concluded with a statement: “There are several other factors, such as operational, legal and commercial considerations, that will impact design choices around digital pound payments at points of sale. Those factors were not tested in this experiment.”