Piero Cipollone, a member of the European Central Bank's (ECB) Executive Board, has warned that Europe's dependence on non-European companies creates vulnerabilities in essential payment services, saying the digital euro would give the bloc a publicly backed alternative without excluding foreign providers from the market.

In an interview published by the ECB, Cipollone said: “Payments constitute a strategic infrastructure for Europe and, as a central bank, ensuring the smooth functioning of payment systems falls within our mandate. Whenever we buy something online or pay for a coffee, we think about the price of what we're buying. But we hardly ever think about how the payment is made. Yet if the payment system stops working, the economy stops working.”

Purchases are increasingly being made online, Cipollone noted. “In Italy, for example, according to the latest available data, online payments grew from 6% of the total in 2019 to 24% in 2024. And I expect they've grown even more since then.”

He argued that this shift heightens the risks of over-dependency on non-European operators. “These online purchases are normally made via card payments and two thirds of these payments are made using non-European card schemes. For most euro area countries, this dependence on non-European operators is not limited to online payments but also extends to physical shops, because they don't even have anything like Italy's Bancomat that would enable payments to be made in local shops. In short, for an essential service like payments, we are heavily dependent on an infrastructure over which we have no direct control.”

The digital euro will be offered through two options. Banks will be able to integrate the digital euro into the apps their clients already use, while the Eurosystem will provide an easy-to-use, standardised and reliable app covering the basic functions. “Even if you use the latter option, your relationship will nevertheless still be with your own bank; the ECB will not open accounts for people,” Cipollone said.

Digital euro payments will also work offline during a power cut or in remote and isolated areas where there is no internet connection, or where the connection is weak and sporadic. “It will suffice to bring two devices together, as when using a contactless card today. The payment will be made directly between the payor and payee, without going via the internet. It means merchants can keep receiving payments even when other digital payment methods are not available.”

The ECB plans to pilot-test real transactions in 2027, together with the Eurosystem's national central banks, with a potential launch in 2029, subject to EU legislation that is expected to advance by the end of 2026. The central bank has already selected 36 payment providers for the pilot ahead of the 2027 trial, according to earlier announcements. The pilot will therefore precede any potential launch and test real transactions while EU lawmakers consider the legislation required for deployment.

The project aims to provide a digital form of central bank money for everyday payments, complementing cash and existing payment systems. Central bank digital (CBDCs) of this kind are issued and backed by a country's or currency area's monetary authority, distinguishing them from privately issued digital payment instruments.