The European Commission recently put forward a legislative proposal for the introduction of a digital euro payments system.
It assures that this system will not be a substitute for physical cash, as it recognizes that the majority of Europeans still prefer to use tangible currency. However, there is an increasing inclination towards digital payments.
More about the digital Euro system in Europe
“While 60% of people surveyed would like to continue to have the option to use cash, an increasing number of people are choosing to pay digitally, using cards and applications issued by banks and other digital and financial firms. This trend was accelerated by the COVID-19 pandemic,” according to the notes revealed by the online publication the Daily Hodl.
The Commission has proposed two complementary measures to accommodate the changing payment landscape.
These measures aim to provide people with the option to pay with either cash or digital central bank money. One proposal outlines a framework for the launch of the digital euro, while the other seeks to ensure the continued use of cash.
The European Central Bank has expressed support for these proposals and is willing to provide technical assistance to facilitate the introduction of the digital euro.
ECB President Christine Lagarde says the following:
“The euro is the most tangible symbol of European integration… It is highly valued and trusted by citizens. We look forward to continuing working together with other EU institutions towards a digital euro to ensure our currency is fit for the digital age.”
Executive Board member Fabio Panetta, who chairs the High-Level Task Force on a digital euro, says the following:
“The legislative proposal is key to ensuring that the digital euro brings value to the people, taking the appreciated features of cash into the digital sphere. The ECB also welcomes the Commission’s proposal on the legal tender status of euro cash, to ensure banknotes remain easily accessible for citizens and businesses and widely accepted throughout the euro area.”
