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ECB embraces digital payments: find out how the digital euro can meet the growing needs of consumers!

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The central bank has committed to developing the digital version of a central bank currency. Upon successful launch, the Central Bank Digital Currency (CBDC) will expand payment options beyond cash offerings.

In a statement, the executive board member noted that the bank launched an investigation into a digital euro more than a year ago, with the close involvement of the European Parliament. According to the survey, people are moving from cash payments to digital transactions. Over the past three years, the use of cash payments in European countries has dropped from 72% to 59%. With digital payments gaining ground, many are changing their payment behavior and fewer people are settling for cash payments.

The bank reiterated that the digital euro does not replace cash but complements it. Fabio Panetta stated:

“Our priority for the digital euro project has always been clear: to preserve the role of central bank money in retail payments by offering an additional option to pay with public money, even where this is not possible today, for example in e-commerce.” The digital euro would not replace other electronic payment methods, or even cash. On the contrary, it would complement them. And in doing so, it would preserve our monetary sovereignty while strengthening Europe’s strategic autonomy.”

ECB comments on the digital euro

People also prefer that there is an option to pay with public money. The ECB believes that the digital euro meets the growing preference for digital payments. According to Panetta, the CBDC gives Europeans access to another payment choice that is free and available anywhere in the jurisdiction. The executive member is confident that the accessibility and convenience of the digital euro will help the currency attract more adoption and financial inclusion.

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In addition, the European Central Bank member noted that the digital euro would have a single set of rules allowing intermediaries to create CBDC-based products and services. Fabio Panetta added that it would be better if the basic services of the digital euro were free, as this would be for the benefit of the general public.

“With the European Commission, we are still analyzing a possible compensation model for the digital euro. In parallel, we are reviewing all design options in order to bring them together in a high-level design for the digital euro in the spring. We are also finalizing our prototyping work and soliciting input from the market to get an overview of options for the engineering design of potential Digital Euro components and services.”

Another ECB plan for the digital euro is to make it usable without barriers. The committee explained that the currency would be accessible worldwide to fulfill its role as a monetary anchor. The ECB intends to continue its research on the digital euro this year.

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