The European Central Bank wants to step up the rollout of the digital euro. If the legislation is finalized by then, a pilot will start in 2027.
The European Central Bank (ECB) is unveiling the intended timeline for the introduction of the digital euro in the Eurozone. The first preparation phase, which began in November 2023, is said to have been successfully completed. Now, the ECB wants to start the technical preparation, which should pave the way for issuance in 2029.
The previous phase resulted in, among other things, a draft rulebook for the digital euro, the selection of technology partners, and the establishment of a platform for experiments with market players. According to the ECB, a digital euro makes it possible to digitally supplement cash with a widely accessible means of payment that is available everywhere in the Eurozone.
Phase 2: Legislation, Pilot and Issuance
In the new phase, the Eurosystem focuses on three areas: technical preparation, market involvement and support for the legislative process. On a technical level, the systems for the digital euro are being developed and tested via pilot projects. The ECB wants to start with this in 2027.
At the same time, the Eurosystem wants to enter into dialogue with traders, consumers and payment service providers. The outcome of user surveys, including among vulnerable groups and small traders, shows, according to the ECB, that there is a need for a simple, reliable and secure digital means of payment. A possible issuance will not take place until 2029 at the earliest.
An important condition in the progress of the digital euro is the legislation. Without a legal framework, the ECB will not introduce it. This is still under development and should be ready by the end of next year, although with European legislation there is never a guarantee that the proposed deadline will be met.
1.3 Billion Euros
The estimated development cost will then be approximately 1.3 billion euros, with annual operating costs of approximately 320 million euros. These costs are borne by the Eurosystem, similar to the current costs for the issuance of euro coins and banknotes.
The ECB emphasizes that the digital euro will exist alongside cash and is not intended to completely replace it. Banks and payment service providers can also integrate the digital means of payment into their existing systems and products. The digital euro should also contribute to a more resilient and competitive European payment system.