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Why do we need a digital euro?

A digital euro would be an additional payment option to choose from, alongside cash.

The way people pay is changing rapidly and consumers in the euro area increasingly prefer to pay electronically rather than with cash.

This is why, in order to safeguard the role of public money and maintain trust in our currency, we’re exploring the benefits of a safe and universally accepted digital euro.

We remain committed to ensuring that cash continues to be accepted everywhere in the euro area too.

Financial innovation

The evolution of money

Many aspects of our lives are becoming digitalised, and money is no different. Cash will continue to be a payment option; it will not be replaced. At the same time, to ensure that our currency remains future-proof, it needs to evolve in line with people’s payment preferences. Similar to cash today, a digital euro would bring inclusivity and privacy in the digital era.

Making our lives easier

A digital euro would make our lives easier by giving us the choice to pay with a secure means of payment universally accepted throughout the euro area. Like cash, paying with digital euro would be free of charge for everyone in the euro area.

A stronger Europe

A digital euro would make the euro area more robust. It would support Europe’s strategic autonomy and monetary sovereignty, making our payments landscape more competitive and resilient to non-European payment providers. A digital euro would also offer a foundation for further innovation by private payment service providers.

The importance of central bank money

What is central bank money?

The money that we at the ECB create is called central bank money. The cash in your wallet or purse is central bank money. In fact, banknotes and coins are currently the only kind of central bank money available to the public.

Central bank money is also called public money because it is issued by a public institution – the central bank – and is therefore backed by the public sector.

What is private money?

Commercial banks also create money. That’s actually what they do when they grant you a new loan and the money appears in your bank account. This kind of money is called private money. This also includes the balance you see on your bank statement and the savings in your account. The payments you currently make with your debit or credit cards, or via an online payment service, are all transfers of private money, because you are using money created by your bank.

A digital euro: bridging the gap

Today, people do not have access to central bank money in digital form.

Our aim is to combine the benefits of central bank money and the ease with which people make their payments in today’s world. This would allow us to provide you with public money in electronic form, in addition to cash. The way to do this is a central bank digital currency: a digital euro.

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