The European Central Bank published a presentation by Executive Board member Piero Cipollone outlining the policy rationale for a digital euro as a digital form of cash and setting out the Eurosystem’s planned pilot approach and key dependencies on EU legislation. The presentation highlighted that euro area retail payments are heavily reliant on non-European card schemes, with 15 of 21 countries lacking a significantly used domestic in-store digital payment solution and nearly two-thirds of euro area card transactions processed by international schemes. The digital euro is framed as an additional pan-euro area payment option that complements cash, supports freedom of choice, and is designed to be available both online and offline, including in situations of limited connectivity or power outages. It also set out intended benefits for merchants and payment service providers, including lower fees and instant receipt of funds for merchants, and a compensation model intended to ensure fair remuneration while allowing providers to maintain client relationships. A 12-month pilot is planned to start in the second half of 2027 in a controlled Eurosystem environment involving real-world transactions, with a limited number of payment service providers, merchants and Eurosystem staff participating. Payment service provider selection is due to begin in the first quarter of 2026, and the pilot is set to test four use cases covering online and offline person-to-person payments and online person-to-business payments at the point of sale and in e-commerce. The ECB also noted that the Governing Council will only consider whether to issue a digital euro once the legislation has been adopted, and referenced the Council of the European Union’s agreed negotiating position and European Parliament discussions expected to reach a conclusive position in May.
European Central Bank 2026-03-21
European Central Bank details digital euro pilot plan starting in second half of 2027 and participant selection from Q1 2026
The European Central Bank (ECB) outlined the policy rationale for a digital euro, emphasizing its role as a digital form of cash to complement existing payment options and enhance freedom of choice. A 12-month pilot is planned for the second half of 2027, involving real-world transactions with selected payment service providers and merchants. The ECB will decide on issuing a digital euro after relevant EU legislation is adopted, with discussions expected to conclude in May.