The Bank of Italy has published a policy note arguing that digital euro merchant fee caps should use benchmarks that individual payment service providers cannot materially influence and that merchants can verify at little or no cost. The analysis contributes to the debate over the digital euro compensation model as EU lawmakers advance the proposed regulation following the European Parliament’s first-reading approval. Applying these criteria, the authors find that a euro area-wide average of fees for comparable payment methods would be more robust, transparent and administrable than a merchant-specific rule tied to the lowest comparable fee paid by each merchant. Merchant-specific caps could encourage providers to restructure prices or contractual terms, require costly case-by-case calculations and preserve existing disadvantages for smaller merchants with weaker bargaining positions. The note also identifies an exemption for qualifying low-value transactions as a potentially compatible complement, while stressing that the overall model would still depend on cap calibration, provider remuneration and interaction with inter-provider fees.
2026-09-09Bank of Italy
Bank of Italy publishes study favoring market-wide benchmarks for digital euro merchant fee caps
A Bank of Italy policy note argues that digital euro merchant fee caps should be resistant to influence by individual payment providers and easy for merchants to verify. It finds that market-wide benchmarks meet these criteria better than merchant-specific caps, which could invite price restructuring, raise compliance costs and preserve weaker terms for smaller merchants.