The ECB Bets a Digital Euro Is the Key to Resilience and Inclusion

The European Central Bank (ECB) is intensifying its efforts to introduce a digital euro, framing it as a critical tool to enhance the resilience of the eurozone’s payment systems and support financial inclusion. During a recent address to the European Parliament, ECB board member Piero Cipollone emphasized the urgency of deploying a digital euro to safeguard the euro’s availability and accessibility amid growing digital and geopolitical risks. Cipollone outlined how a digital euro would serve as a complementary form of legal tender, functioning alongside physical cash and ensuring that Europeans can make transactions even during major disruptions such as cyberattacks or network outages. The ECB is advocating for the digital euro to be designed with distributed infrastructure, offline functionality, and an accessible user interface to ensure continuity and broad usability.

Cipollone highlighted the current reliance on non-EU providers for the core of digital payment systems, a situation that could limit the euro area’s ability to respond swiftly during crises. A digital euro, by contrast, would provide an independent and secure alternative payment mechanism, especially in scenarios where private providers fail. The ECB envisions a digital euro app that could allow users to switch between payment service providers and access basic payment functions even when individual providers are compromised. The app would also facilitate offline transactions, a feature crucial during power outages or other disruptions that could render online payment systems inoperable. The ECB is pushing for legislation that mandates all payment service providers to support this app, ensuring that users are not left without options in times of system failures.

Inclusiveness remains a core objective for the ECB, as it seeks to ensure that the digital euro remains accessible to all citizens, regardless of digital literacy or socioeconomic status. The ECB is working closely with representatives of vulnerable groups and conducting user research to design the digital euro with adaptive features such as voice commands, large-font displays, and simplified workflows. These efforts aim to reduce barriers to entry for individuals with disabilities and those with limited access to smartphones or digital services. Additionally, the ECB is exploring partnerships with local institutions such as libraries and post offices to offer in-person support and facilitate access to digital euro services in underserved communities.

While the ECB has outlined a clear vision for the digital euro, some EU lawmakers remain skeptical, raising concerns about privacy and the potential impact on commercial banks. Critics have questioned whether a central bank digital currency (CBDC) would offer sufficient safeguards against data collection and whether it might undermine the private banking sector by providing a safer alternative for users. Cipollone responded by asserting that the ECB would not have access to transaction details and that the digital euro would operate in a manner that preserves privacy. He also dismissed concerns over a potential exodus of users from private banks, noting that individuals and businesses might seek non-euro denominated stablecoins in crisis situations, making the digital euro a less pressing issue by comparison.

The ECB is currently working under the assumption that the necessary legislation for the digital euro will be finalized by the second quarter of 2026. Following legislative approval, the ECB estimates that the development and testing phase could take up to three years, positioning a potential launch as early as 2029. However, delays in the legislative process remain a challenge, with the European Parliament, European Commission, and European Council needing to reach consensus on the framework for the digital euro. The ECB has called for a coordinated and accelerated approach to ensure that the digital euro is launched in a timely manner, reinforcing the eurozone’s resilience and economic security in a rapidly evolving digital landscape.

Source:

[1] The digital euro: ensuring resilience and inclusion in digital (https://www.ecb.europa.eu/press/key/date/2025/html/ecb.sp250904~70ab593276.en.html)

[2] EU lawmakers skeptical of digital euro as ECB renews pitch (https://cointelegraph.com/news/digital-euro-ecb-lawmakers-privacy-risks)

[3] CBDC News: ECB Says Digital Euro a Necessary Tool (https://www.coindesk.com/policy/2025/09/04/digital-euro-a-necessary-tool-during-major-disruptions-says-ecb)