- Technology
- News Desk
- Source: European Central Bank https://www.ecb.europa.eu//press/inter/date/2026/html/ecb.in261024~ee2ba73cf3.en.html
The European Central Bank will launch a pilot for the digital euro in 2027, using real transactions by staff of the ECB and national central banks, and could roll out the currency as early as 2029 if legislation is approved, Executive Board member Piero Cipollone said in an interview with Milano Finanza on 21 October 2026. He said the decision to issue the digital euro can only be taken once negotiations in Brussels are concluded, with the ECB hoping the regulation is adopted by the end of the year.
Key facts
Why does the ECB want a digital euro?
- ECB Executive Board member Piero Cipollone gave the interview to Milano Finanza on 21 October 2026.
- A digital euro pilot based on real transactions by ECB and national central bank staff will start in 2027.
- 36 market operators, including seven Italian ones, are already involved in preparatory work.
- The digital euro could be rolled out as early as 2029 if the regulation is approved this year.
- In Italy, online payments rose from 6% of the total in 2019 to 24% in 2024, according to the latest data cited by Cipollone.
Cipollone said payments are a strategic infrastructure for Europe and ensuring payment systems function smoothly is part of the central bank's mandate. He noted that when people buy something online or pay for a coffee, they rarely think about how the payment is made, but if the payment system stops working, the economy stops working.
He argued that central bank money is currently available only as cash, while a growing share of economic activity takes place online where banknotes cannot be used. The digital euro would fill that gap, giving people the freedom to pay with an instrument equivalent to cash in its nature and characteristics, including privacy and coverage of all payment needs, but which also works where cash cannot. How dependent is Europe on foreign payment systems?
Cipollone cited data showing that online payments in Italy grew from 6% of the total in 2019 to 24% in 2024, and he expects further growth. These purchases are normally made via card payments, and two thirds of these payments use non-European card schemes.
For most euro area countries, he said, dependence on non-European operators extends to physical shops as well, because they lack a domestic scheme comparable to Italy's Bancomat. He described this as heavy reliance on an infrastructure over which Europe has no direct control for an essential service like payments. Is the digital euro a sovereignty project?
Cipollone said the Eurosystem focuses on matters closely tied to its mandate, and if Europe is critically dependent on third parties it is not easy to ensure smooth functioning of payments. He noted that in recent years Europe has learned that for some essential services it cannot rely only on third parties, citing energy and defence as examples.
The digital euro would give Europe its own alternative, bringing to the digital world what cash has always ensured: a secure form of public money that protects privacy and is accepted throughout the euro area. He stressed that sovereignty does not mean shutting third parties out but having the power to choose and knowing that Europe can rely on its own strength for an essential service like payments. What benefits for merchants and consumers?
Cipollone said small merchants in particular face fees that can be up to four times higher than those paid by large operators. The digital euro would introduce a European alternative that increases competition and, thanks to legally mandated caps on costs, help reduce fees for those with less bargaining power.
He also said there will be a limit on how much digital euro individuals can hold, but no limits on payments. If a payment exceeds the available balance, the remainder can be taken automatically from a linked current account. The holding limit is intended to safeguard financial stability, particularly in crises, and ECB analyses show that with a properly calibrated limit there will be no negative effects on the banking system. Will it work offline?
Cipollone confirmed that offline payments will be possible, for example in shops during a power cut or in remote areas with no or weak internet connection. Two devices would simply be brought together, as with a contactless card today, and the payment would be made directly between payor and payee without going via the internet. What happens next?
The ECB hopes the regulation will be adopted by the end of the year, which would allow its Governing Council to take a formal decision on issuance. Adoption would also make it possible to complete the rulebook with technical rules needed for the market to prepare. Cipollone said the ECB can get the infrastructure ready, but banks, payment system operators and merchants will also need time to adapt their systems and processes.
Source: European Central Bank
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