Interview with Corriere della Sera
The European Central Bank confirms the digital euro will complement, not replace, cash, with a potential launch in 2029 and no cost to users, addressing merchant payment fees and offline usability.
The European Central Bank (ECB) has clarified that the digital euro will not replace cash but will complement it, offering the same security and cost-free access. The ECB is also introducing a new series of euro banknotes with advanced anti-counterfeiting features, reinforcing its commitment to physical currency alongside digital innovation. The digital euro will be accessible via an app provided by the ECB, banks, or payment service providers, ensuring broad availability. It will also include a card option for those without smartphones, maintaining accessibility for all users.
The ECB highlights that the digital euro addresses high and opaque fees merchants face when accepting card payments, which often erode their already tight margins. For small merchants, the cost of accepting digital payments could be reduced by half, providing a public alternative to private payment systems. The digital euro will integrate with existing European payment solutions like Satispay and Bancomat, expanding its usability across the euro area. Italy, with 570,000 merchants employing nearly two million people, stands to benefit significantly from these cost reductions.
The digital euro will support offline transactions, ensuring usability during power outages or internet disruptions, mimicking cash in this regard. The ECB has launched a pilot project, with the first tests beginning next year and payments expected within 12 months. Legislative debates in Brussels are underway to establish the necessary European framework, with the ECB aiming to finalize the legislative text by the end of the year.
The ECB emphasizes the strategic importance of the digital euro for European autonomy, particularly in light of geopolitical vulnerabilities exposed by the invasion of Ukraine. The project aims to reduce reliance on non-European payment systems, ensuring control over critical infrastructure. The ECB has already signed technical standard agreements and selected 36 participants, including several Italian banks, for the pilot phase. The digital euro will require widespread merchant adoption, necessitating system updates across the euro area to integrate it seamlessly.