In an exchange with the European Parliament’s Committee on Economic and Monetary Affairs, European Central Bank Executive Board member Piero Cipollone published an update on the digital euro, reporting progress on legislative and technical preparations and confirming that the Governing Council has moved the project into a new phase focused on developing the technical capacity needed for potential issuance. The ECB framed the digital euro as a digital form of cash for day-to-day payments that would complement banknotes and coins, while reducing euro area reliance on non-European retail payment providers. Distribution is envisaged through banks, with non-remunerated and capped holdings and a link to commercial bank accounts to support larger payments; a compensation model would rely on the Eurosystem not charging scheme or settlement fees. The statement also set out privacy and control safeguards, including offline cash-like privacy, pseudonymisation and encryption for online payments, AML/CFT checks carried out by banks, and no programmability or mandatory use; bank investment costs were estimated at about 3.4% of significant banks’ annual IT upgrade budgets over four years, with total annual costs of around EUR 1.0 billion to EUR 1.44 billion. The EU Council aims to agree its general approach to the draft legislation by end-2025, and the ECB reiterated that any final decision to issue a digital euro will only be taken once the legislation is adopted. Assuming co-legislators adopt the regulation establishing a digital euro in 2026, the ECB indicated that a pilot exercise and initial transactions could start from mid-2027, with readiness for first issuance in 2029.
European Central Bank 2025-11-17
European Central Bank moves digital euro project into next phase and signals mid-2027 pilot and possible 2029 issuance pending EU legislation
The European Central Bank (ECB) has advanced the digital euro project into a new phase, focusing on developing technical capacity for potential issuance. The digital euro is intended as a digital form of cash for everyday payments, complementing physical currency and reducing reliance on non-European payment providers. The ECB plans for a pilot exercise and initial transactions by mid-2027, with potential issuance readiness by 2029, contingent on legislative approval.