Europe Plans to Be on the Cutting-Edge of the Digital Economy 


The European Banking Federation (EBF) recently released its “Vision on a Digital Euro Ecosystem,” report, which delves into what the digital money ecosystem may look like in the years to come.  

For the digital euro to meet the changing needs of customers, the EBF report highlighted a few principles to ensure more value is delivered to customers, while, at the same time, potential risk is reduced.  

The report goes further into emphasizing the desire for a European strategic autonomy by way of having a “strong, resilient, innovative, and competitive payments and digital asset ecosystem.” 

One of the most significant ways to meet the constantly evolving payment needs is by introducing the retail digital euro. But before Europe can move forward with this solution, the following pre-conditions must be in place: 

  • The right design 
  • A robust and sustainable business model to uphold it 
  • A strong role for the market in designing payment solutions 

What’s more, a wholesale digital euro can be used for the settlement of interbank transfers and wholesale transactions in central bank reserves. This would uphold the role of the euro at the international level and improve cross-border payments globally. 

Finally, bank-issued money tokens would meet the evolving needs of customers such as automated industrial processes for businesses. 

Europeans Want Digital Currency to Be Privacy-Preserving 

In order to secure trust from the public, the European Central Bank’s (ECB) access to users’ personal data must be limited, however, this might not be entirely possible.  

Intermediaries must have access to payment transaction data, as they do with any digital payment. Currently, access is governed by the Anti-Money Laundering Directive (AMLD), the General Data Protection Regulation (GDPR), and the Payment Services Directive (PSD2). 

Having access to customers’ payment data, with their permission, enables intermediaries to provide value-added services and create tools to protect the users from fraudulent activity. 

CBDCs are evolving worldwide as the use of banknotes is seeing a steady decline. As many as 65 countries are in the advanced stages of launching their own CBDCs and over 20 banks have launched a pilot program.  


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