In response to the growing popularity of electronic payments, including contactless payments and mobile transactions, which was further accelerated by the COVID-19 pandemic, the European Union (EU) is proposing a legal framework for a potential digital euro. The EU’s objective is to ensure the continued acceptance and accessibility of cash while embracing the possibilities offered by digital currencies.
The proposed digital euro would be a complementary form of payment, coexisting with cash and providing an alternative to existing private digital solutions. It aims to offer several benefits to individuals and businesses, including free usage for consumers, increased choice, and the ability to pay even without a bank account or internet access. The privacy of digital euro transactions is emphasized, with offline transactions ensuring stronger privacy protection than other digital payment methods. The European Central Bank assures that personal data would only be accessed for necessary payment processing, fraud prevention, and anti-money laundering efforts.
The EU recognizes the importance of the euro as a symbol of unity and strength, with more than two decades of successful usage in the form of coins and banknotes. The introduction of a digital euro would not alter this, as people and businesses would maintain the familiar experience of using the currency. The proposal emphasizes the commitment to ensuring the wide acceptance and easy accessibility of cash, recognizing its continued importance in the payment landscape.
The European Parliament and Council will engage in a democratic process to debate and shape the proposal, while the final decision on the implementation of a digital euro rests with the European Central Bank. This decision-making process is expected to take several years, allowing for comprehensive discussions and considerations of all aspects involved.
The proposal for a legal framework for the digital euro represents a significant step forward in the EU’s digital payment landscape. By providing consumers with a secure, accessible, and privacy-conscious digital currency, the EU aims to meet the evolving needs and preferences of individuals and businesses throughout the euro area.
https://ec.europa.eu/commission/presscorner/detail/en/FS_23_3563