The European Council has agreed its negotiating position on draft EU regulations that would create the legal framework for a potential digital euro and clarify the legal tender status of euro banknotes and coins. The package is intended to enable the introduction of a central bank backed digital means of payment while safeguarding the wide acceptance and availability of cash across the euro area. For the digital euro, the Council position confirms it would complement cash, be usable online and offline, allow for payments and transfers with a high degree of privacy, and coexist with private payment instruments. It introduces safeguards and market rules including European Central Bank set holding limits subject to an overall ceiling agreed by the Council and reviewed at least every two years, and restrictions on payment service providers charging consumers for mandatory services such as opening and closing accounts, executing digital euro transactions, and funding or defunding digital euro accounts or wallets with deposits held at the same provider. The mandate also sets expectations on access to mobile device hardware and software for digital euro interface providers, and caps interchange and merchant service charges for a transitional period of at least five years based on fees for comparable payment means, with later caps linked to the actual costs of the digital euro. On cash, the Council indicates a preference to effectively ban retailers’ and service providers’ non-acceptance of cash with limited exceptions such as distance purchases including online and unmanned points of sale, requires member states to monitor cash acceptance and access using common and national indicators and take remedial measures where needed, and expects member states to establish cash resilience plans or measures for widespread and severe disruptions to electronic payments. The agreed position allows the Council to begin negotiations with the European Parliament. Once the legal framework is adopted, the European Central Bank will decide whether to issue a digital euro, and it has indicated the digital euro could be operational by 2029.
European Council 2025-12-19
European Council agrees negotiating mandate on digital euro framework and stronger legal tender rules for euro cash
The European Council has set its negotiating position on draft EU regulations for a digital euro, aiming to create a legal framework that complements cash and ensures transaction privacy. The framework includes holding limits, service charge restrictions, and access expectations for digital euro interfaces, while addressing cash acceptance and resilience. This position enables negotiations with the European Parliament, with the European Central Bank potentially issuing a digital euro by 2029.