source: https://www.ecb.europa.eu/euro/digital_euro/progress/html/ecb.deprp202510.en.html
“A digital euro will ensure that people enjoy the benefits of cash also in the digital era. In doing so, it will enhance the resilience of Europe’s payment landscape, lower costs for merchants, and create a platform for private companies to innovate, scale up and compete”.
Piero Cipollone, ECB Executive Board member
The Eurosystem’s digital euro project aims to adapt central bank money to the digital age, addressing the current challenges of the European payments ecosystem. As payment habits evolve, the use of cash declines and digital transactions become the norm, the need for a public digital means of payment – complementary to cash – has become increasingly urgent. As digital cash, the digital euro is designed to complement physical cash, ensuring that everyone in the euro area can keep using a public, trusted and universally accepted means of payment –now and in the future. Therefore, it will preserve freedom of choice and Europe’s monetary sovereignty across the euro area. In addition, it will foster innovation in payments and help make European payments competitive, resilient and inclusive.
In 2021 the Eurosystem embarked on the investigation phase (2021-23), which focused mainly on the design of the digital euro. In November 2023 the Eurosystem decided to launch a two-year preparation phase to lay the groundwork for the potential issuance of a digital euro. The main objectives of this phase included providing a draft digital euro scheme rulebook, selecting potential providers for the digital euro platform and infrastructure, learning through experimentation and user research, conducting more in-depth technical analyses, and interacting with stakeholders to ensure a digital euro would meet the highest standards of quality, security, privacy and usability. All these objectives have been achieved.
One important area of work in the preparation phase was the further development of the draft digital euro scheme rulebook. The rulebook provides a single set of rules, standards and procedures for the provision of basic digital euro payments services for payment service providers (PSPs) participating in the scheme. It draws as far as possible on existing industry standards and market practices. While the rulebook will ensure a standardised digital euro payment experience across the euro area, it distinguishes between provisions that are mandatory for all scheme participants and provisions that are only optional, illustrative and intended to further support participating PSPs in their implementation efforts. Through this approach, the rulebook standardises requirements and limits them to what is necessary, while providing the basis for the development of further innovative services and supporting interoperability. At the time of closing this report, a new and comprehensive draft version of the rulebook had been shared and commented on by the digital euro scheme’s Rulebook Development Group (RDG) and its constituents. This new draft version covers the functional requirements (such as requirements for the digital euro services related to access, liquidity and transaction management) and non-functional requirements (such as requirements for availability, latency and maintenance). The draft also covers requirements for minimum user experience, dispute management and the application of the digital euro brand, along with detailed implementation specifications. While the draft rulebook will cover all basic digital euro services for the use cases considered, a roll-out plan for the digital euro’s functionality will need to be developed to inform and facilitate its implementation by scheme participants.[
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] The process that led to the current draft began in the investigation phase, supported by the RDG.[
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] It has been collaborative and iterative, and brings together representatives of consumers, merchants, PSPs and third-party service providers from across the European retail payments market, as well as observers from the Eurosystem national central banks (NCBs) and EU institutions.
The selection of providers for the digital euro service platform (DESP) was another key milestone achieved. The sourcing process covered both externally procured and internally sourced components. Externally, the European Central Bank (ECB) launched tenders for five components of the DESP; core settlement and issuance components were sourced within the Eurosystem. Five external providers were selected, and they all signed framework agreements.[
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] These do not entail financial commitments at this stage; any development or operational work will be initiated through subsequent specific agreements.
In parallel, the ECB launched an innovation platform[
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] to explore how the digital euro could support innovation in payments and address new market needs. Structured into two workstreams – pioneers and visionaries – the initiative involved around 70 market participants, including banks, fintechs, merchants and PSPs. The pioneers tested features such as conditional payments[
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] in a simulated environment, while the visionaries proposed forward-looking new ways to integrate the digital euro into Europe’s financial ecosystem. The work demonstrated that market participants see strong innovative potential in the digital euro, in terms of both technical capabilities and its role in improving financial inclusion, while enabling market participants to develop new business opportunities.
Ensuring accessibility and inclusion has been a guiding principle in the design of the digital euro. In designing the digital euro app, a particular focus was placed on accessibility to ensure the app would be usable by everyone, including people with physical disabilities, low digital skills or learning impairments. The design is informed by user research and feedback from civil society organisations, confirming the importance of multiple onboarding options and payment flows that feel familiar and reassuring. These efforts aim to make the digital euro usable and relatable for everyone – particularly vulnerable groups – and will continue to evolve in the next phase to ensure no one is left behind.
On the technical front, the ECB advanced its analysis to ensure the digital euro remains operational and resilient in a wide range of scenarios, including in emergencies such as power or network outages. Key areas of work included the design of the offline functionality – a crucial innovation allowing payments to be made even when internet connectivity is lost, thus making the European payment landscape even more resilient and providing a cash-like level of privacy. These efforts are aimed at supporting the resilience, usability and inclusiveness of the digital euro and ensuring continuity of payments in critical situations.
To ensure the digital euro’s design is inclusive and meets the needs of European citizens and merchants, the ECB conducted user research throughout the preparation phase, focusing on payment preferences and behaviours. The ECB commissioned both quantitative and qualitative research to gather insights from a broad spectrum of potential users across the euro area. The ECB engaged small merchants and vulnerable consumers through focus groups and interviews.[
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] When considering the adoption of a new payment method, vulnerable consumers emphasised the importance of a universally accepted solution with simple, intuitive design and access to in-person support. They also expressed a preference for new payment methods to be distributed by trusted banks and/or public bodies and showed greater willingness to try them if offered by a European provider. Small merchants supported the value proposition of the digital euro and emphasised the importance of increased bargaining power to negotiate lower transaction fees and of seamless integration with their existing systems. The backing of the digital euro by the ECB was also viewed as a further positive factor and perceived as a guarantee of strong payment security, which could increase consumer trust and potential adoption. The Eurosystem also conducted a survey among a large and representative panel of EU citizens to explore payment attitudes and preferences and explore the usability aspects of the digital euro. A majority of respondents (66%) showed interest in trying the digital euro – which is broadly consistent with findings from other surveys conducted by the ECB and NCBs.
Stakeholder engagement was a cornerstone of advancing technical work on the design of the digital euro in the preparation phase. The ECB further intensified its outreach to banks and non-bank PSPs, merchants and consumers through technical sessions, workshops and bilateral meetings at expert and strategic level. Special attention was given to how the digital euro would fit into the existing European payments ecosystem, with dedicated Euro Retail Payments Board (ERPB) technical sessions to assess value drivers across the themes of competition, synergies and business model. The outcome of this work[
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] showed there was consensus among market stakeholders across several topics, while on other topics there were diverging views. Key benefits identified by the ECB and all stakeholders included the following: (i) the digital euro would enhance competitiveness in the European payment landscape by strengthening the negotiating position of European PSPs and merchants; (ii) by making use of open digital euro standards, European PSPs and account-to-account (A2A) schemes can voluntarily integrate the digital euro into their payment solutions and/ or co-badge it on physical cards; (iii) the digital euro would establish a “common acceptance layer” for A2A payments, facilitating seamless transactions across point-of-sale (POS) and e-commerce platforms for European players; and (iv) a staggered roll-out approach could be considered for the introduction of the digital euro, striking an optimal balance between market relevance, the Eurosystem’s policy objectives, and technical and implementation costs. A phased roll-out of functionalities would thus enable both costs and resources to be spread over time, while focusing on essential use cases first, ensuring broad adoption and resilience.
The ECB also continued regularly engaging with EU institutions throughout the preparation phase, providing technical input to support the legislative process and keeping the Eurogroup and the European Parliament informed on project developments. This phase has been underpinned by ongoing legislative efforts at European level, with EU leaders emphasising the strategic importance of a digital euro and calling both at their March[
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] and October[
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] 2025 meetings for swift progress on its adoption to meet the evolving needs of citizens and businesses. In their meeting on 19 September 2025, finance ministers in the Eurogroup agreed on the governance framework around the issuance of the digital euro and on the process of setting a holding limit.[
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] This further facilitates the legislative progress in the Council. In parallel, the ECB responded to co-legislators’ requests that emerged during the legislative negotiations with two technical analyses: one assessing the potential financial stability effects of a range of hypothetical digital euro holding limits[
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], and another evaluating investment costs for the banking sector[
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]. The first analysis confirmed that using the digital euro for day-to-day payments would not harm financial stability and that – given the different hypothetical holding limits of up to €3,000 per person that the co-legislators asked to be tested – the impact of the digital euro would not harm financial stability within the euro area, even under a highly unlikely and extremely conservative crisis scenario. The second analysis found that investment costs for the banking sector could range between €4 billion and €5.8 billion. This would be broadly in line with the estimates given by the European Commission in its draft Regulation impact assessment in 2023 and would be comparable to cost estimates for initiatives such as the Payment Services Directive (PSD2). Public information and engagement activities were stepped up, with ECB representatives participating in numerous public events and seminars to promote awareness and dialogue around the digital euro’s benefits and design.
On 23 October 2025, European leaders called for accelerated progress on the development of a digital euro. On 29 October 2025, the Governing Council of the ECB decided that the Eurosystem will continue its preparations and move to the next phase of the digital euro project. In this phase, the Eurosystem will build the necessary technical capacity ahead of a possible decision to issue, while maintaining flexibility and alignment with the legislative process.
The ECB aims to be ready for a potential first issuance of the digital euro during 2029. This is based on the working assumption that European co-legislators will adopt the Regulation on the establishment of the digital euro in the course of 2026. A pilot exercise and initial transactions could take place earlier, potentially starting as soon as mid-2027, to prepare for a potential issuance.
To deliver on this shared ambition, the Eurosystem will focus on three main workstreams: advancing technical readiness, deepening market engagement and supporting the legislative process. This will include starting to develop the digital euro’s technical foundations and validating core functionalities by means of piloting; working closely with PSPs, merchants and consumer representatives to progressively test and prepare for a first issuance; and maintaining close engagement with EU co-legislators, institutions and authorities on the digital euro project to continue to provide technical input throughout the legislative process.
The Eurosystem’s continued preparation for a digital euro will follow a flexible implementation approach, ensuring alignment with the legislative process. This approach responds to calls from euro area leaders for the Eurosystem to be ready for potential issuance as soon as possible, while also recognising that the legislation has not yet been adopted. Work will be structured in modules to allow gradual scaling and limited financial commitments. The final cost of a digital euro – both for its development and operation – will depend on its final design, components and related services that need to be developed. Total development costs, comprising both externally and internally developed components, are estimated at around €1.3 billion until the first issuance, which is currently expected during 2029.Subsequent annual operating costs are projected to be approximately €320 million per year from 2029.
The ECB Governing Council’s possible decision on whether to issue a digital euro, and on what date, will only be taken once the legislative act is adopted. The ECB will continue to follow the legislative debate closely and implement any appropriate adjustments to the development of the digital euro that may result from legislative deliberations. The Eurosystem aims to ensure that, when the time comes, the digital euro can be made available as a secure, inclusive and innovative complement to cash across the euro area.
https://www.ecb.europa.eu/euro/digital_euro/progress/html/ecb.deprp202510.en.html
