The UK could pay EU contributions for access to the single market as part of its exit deal, the country's Brexit Secretary David Davis has said.
During a question session in the House of Commons in London, Mr Davis said "of course" the British government would consider paying to retain single market access.
Mr Davis was asked by Labour MP Wayne David: "Will the government consider making any contribution in any shape or form for access to the single market?".
Mr Davis replied: "The major criterion here is we get the best possible access for goods and services and if that is included in what he's talking about then we'll consider it."
After his comments, the pound climbed to a three-month high of €1.19 against the euro and was also up a cent against the US dollar at $1.26.
It is the furthest the UK government has gone on discussing how it will achieve the single market access it has talked about and his response drew mutters from MPs in the Commons.
The idea of paying any level of contribution to the EU will be criticised by so-called Brexiteers, who want a hard Brexit that will see the UK outside the single market.
Although not a member of the EU, Norway pays nearly as much in EU contributions as the UK for access to the single market. It has also had to accept freedom of movement rules.
Mr Davis also told MPs that it was government policy to wrap up negotiations on leaving the EU within two years of Article 50 being triggered - with no transitional deal.
In a speech to businesses last month, British Prime Theresa May appeared to hint at a transitional deal to avoid a Brexit "cliff edge".
Liberal Democrat Leader Tim Farron said: "The government are in an absolute mess. We are seeing chaos over their Brexit plans as they keep sending mixed signals on where they stand on basic, fundamental questions like access to the single market, payments to the EU budget and freedom of movement.
"How can the government claim they have a mandate for their Brexit deal when they don't even know what it is themselves?".
