Digital Euro: What is it, what is it for and when can it arrive?

O digital euro, future e-money to be issued by the European Central Bank (ECB), is beginning to move forward in the European Union (EU) with the first legislative steps and MEPs are ready to negotiate with the countries.

Here are some questions and answers about the digital euro:

+++ What is the digital euro? +++

The digital euro is an electronic version of the euro issued by the ECB that functions as public money, with value equal to the physical single currency, and can be used for digital payments, both on the internet and in physical stores.

The digital euro does not replace physical money, but rather acts as an additional alternative to banknotes and coins, which provides citizens with another payment option by keeping cash as a means of transaction available.

+++ What is the European Commission's proposal? +++

The European Commission presented its legislative proposal for the digital euro in June 2023 in the framework of the package known as the Single Currency Package, which was designed to establish the legal framework for the possible issuance and circulation of the digital currency by the central bank.

In addition to the electronic version, the Single Currency package also includes measures to strengthen the legal tender status of cash, establishing that euro banknotes and coins should as a rule be available and accepted as a means of payment for goods, services and debt settlement, with limited and duly regulated exceptions.

The European Commission's proposal is part of an effort to modernise the payment system and strengthen the European Union's financial sovereignty in order to create a European digital means of payment, accessible to all, which complements physical money and reduces dependence on private infrastructure, often controlled by companies outside the EU.

At the same time, the objective is to ensure competition, innovation and strategic autonomy in the financial sector.

+++ Does the digital euro replace electronic systems such as Visa or Mastercard? +++

The digital euro does not replace any existing electronic system, but the idea is that it functions as a European public alternative, reducing the EU's dependence on international private payment networks.

For the EU institutions, the introduction of the digital euro is necessary to ensure that the euro continues to adapt to developments in citizens' payment preferences and to strengthen the strategic autonomy of the euro area, in particular towards payment technology such as the US Visa or Mastercard.

+++ How does the digital euro work? +++

From a technical point of view, it functions as an account-based payment infrastructure or digital tokens, allowing online and offline transactions, with central bank cash settlement.

The aim is to provide a secure, interoperable and pan-European means of digital payment, complementary to cash and private payment systems.

In terms of operation, the digital euro would have two main modalities: in online payments it will be used through accounts opened in banks or payment service providers, operating similarly to the current digital banking system; while in offline payments it will allow direct transfers between devices, such as mobile phones or cards, without the need for internet connection.

+++ What does the ECB +++ say

The ECB considers that the digital euro should be a secure form of public money in the digital age, complementary to cash, also defending the protection of privacy, financial stability and European control over payment infrastructure in order to ensure that personal data are protected.

+++ When can it come into force? +++

No date set. Negotiations between Parliament (eurodeputies) and the Council of the European Union (countries) now start in so-called trialogues. Only after the final approval of the co-legislators and the technical preparation of the ECB can it be launched, which should take a few years.

It is certain that the ECB is in a position to carry out a possible first digital euro issue in 2029, assuming that the necessary legislation is adopted in the EU during this year 2026.

As part of the technical and operational preparation, the start of an ECB pilot project in the second half of 2027, lasting 12 months, is planned to test the system and ensure a safe and uninterrupted launch.

The final decision on the issuance of the digital euro will not be taken until after the adoption of the Regulation, while the work of the Eurosystem remains flexible and adjusted to the progress of the legislative process, according to the central bank of the single currency.

+++ What MEPs +++ say

MEPs of the European Parliament’s Committee on Economic and Monetary Affairs today approved their position on the digital euro, arguing that it is a “safe, private and free” means of payment, available both online and offline, providing citizens and businesses with a “safe and innovative” payment, while reducing the European Union’s dependence on external suppliers.

For the European Assembly, protection of privacy should be ensured through technologies that avoid the exposure of personal data in transactions.

MEPs also propose limits on the amount of digital euro that each citizen can hold in order to protect financial stability and the banking system, and that this system be widely accepted by traders, with some exceptions, and that essential services be free of charge to users.

Following this position, the parliamentary position in plenary and negotiations with Member States in the Council of the European Union are confirmed before the final adoption of the legislation.

+++ What do countries +++ say

In December 2025, the EU Council defined its position to clarify these rules and their link with the digital euro, ensuring consistency between the two forms of currency issued by the central bank.

For countries, it is urgent to ensure widespread acceptance of cash throughout the euro area and to ensure that citizens continue to have access to physical money and can freely choose the means of payment they prefer.

+++ What are trilogues +++

Following these first ‘green lights’, the trialogues follow, which are informal negotiations between the European Parliament, the Council of the European Union and the European Commission to reach a final agreement on this European law before final adoption.