The European Central Bank published an update on the digital euro project, setting out the current preparation work and a provisional timeline that could see a pilot exercise and initial transactions launched in mid-2027, and readiness for a potential first issuance during 2029. The 2029 timeline is based on a working assumption that EU co-legislators will adopt the Regulation establishing the digital euro during 2026. Work in the current phase, running since November 2025, follows a flexible and modular approach focused on technical readiness, market engagement and support for the legislative process. EU-licensed payment service providers, with banks positioned at the core of distribution, would offer access to the digital euro with safeguards including holding limits, no remuneration, (reverse) waterfall functionality and no holdings for businesses; the ECB also set out a compensation model under which issuing and acquiring banks would not pay scheme and processing fees, with caps on merchant service charges and inter-PSP fees. A 12-month pilot starting in the second half of 2027 is planned in a controlled Eurosystem environment with real-world transactions, involving a limited number of PSPs, merchants and Eurosystem staff across four use cases, with PSP selection starting in the first quarter of 2026. The update also referenced the Council of the European Union’s 19 December 2025 negotiating position, including a transitional period of at least five years for fee caps benchmarked to average debit card fees and changes on open funding, cash conversion obligations, multiple and joint accounts, user interfaces and access to mobile devices for offline digital euro functionality.
European Central Bank 2026-02-18
European Central Bank outlines digital euro roadmap with 12-month pilot from the second half of 2027 and potential issuance in 2029
The European Central Bank (ECB) updated on the digital euro project, outlining a provisional timeline for a pilot exercise and initial transactions by mid-2027, with potential issuance readiness by 2029. The current phase focuses on technical readiness, market engagement, and legislative support, involving EU-licensed payment service providers with banks central to distribution. A 12-month pilot in a controlled Eurosystem environment is planned for late 2027, with fee caps and other measures under negotiation by the Council of the European Union.