Protection for European banks and card schemes - ECB's Cipollone talks about the future of the digital euro
The digital euro will be designed to protect European card schemes and keep banks at the heart of the region's payments system, a senior European Central Bank policymaker said. As a currency managed directly by the ECB through accounts at the central bank, the digital euro project has raised concerns among banks that they could lose their role in handling payments.
ECB Executive Board member Piero Cipollone said changes in the payments industry meant banks faced this risk regardless of the digital euro, which he said would help them.
Cipollone said the digital euro meant "preserving the central position of banks in payments." "Banks could lose their role in payments not only because of stablecoins, but also other private solutions," he said.
Banks risked not only losing revenue but, more importantly, access to their customers' payment data, information they need to provide more profitable services.
The ECB also wants to protect European payment schemes, such as Italy's Bancomat card scheme and Spain's Bizum peer-to-peer scheme, Cipollone said.
National schemes will be able to issue cards that work across the euro area using the digital euro infrastructure under “co-location” arrangements. Such functions will be available well in advance of the planned launch of the digital euro in the second half of 2029.
"The system will be structured in such a way that it remains cheaper for shop owners to use these networks," Cipollone said. "The fee cap that merchants will pay on the digital euro network will be lower than that charged by the international payment network, normally the most expensive, but higher than that charged by the domestic payment scheme, normally the cheapest," he added.
Only eight of the 21 eurozone members have a national payment scheme, while the others rely entirely on international networks. "The digital euro will effectively favor domestic payment schemes," Cipollone said.
Declining transatlantic relations have prompted the ECB to classify as a strategic risk the fact that more than three-quarters of European transactions are processed through international payment schemes such as Visa or Mastercard.
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