The EU Commission set out proposals Wednesday for a framework for a possible digital form of the euro that the ECB may issue in future, as well as for continued access to euro banknotes and coins. While 60 per cent of people in a recent survey wanted to keep the option to use cash, an increasing number are choosing to pay digitally, using cards and applications issued by banks – a trend was accelerated by the COVID-19 pandemic.

“Bringing the euro into the digital age is an important European project,” said Commissioner for Financial Services Mairead McGuinness: “By complementing cash, I have no doubt that a digital euro will bring advantages to citizens and businesses across the EU.”

“Today’s proposal will help frame the debate around what a digital euro is and the advantages of creating it.,” she added. To reflect these trends, the Commission has proposed two mutually supportive sets of measures to ensure that people have both payment options, cash and digital when they want to pay with central bank money:

A legislative proposal on the legal tender of euro cash to safeguard the role of cash, ensure it is widely accepted as a means of payment and remains easily accessible for people and businesses across the euro area.

A legislative proposal establishing the legal framework for a possible digital euro as a complement to euro banknotes and coins. It would ensure that people and businesses have an additional choice – on top of current private options – that allows them to pay digitally with a widely accepted, cheap, secure and resilient form of public money in the euro area (complementing the private solutions that exist today). While the proposal – once adopted by the European Parliament and Council – would establish the legal framework for the digital euro, it will ultimately be for the European Central Bank to decide if and when to issue the digital euro.

Source: EUbusiness

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