As expected, the governing council of the European Central Bank (ECB) approved starting a policy monitoring process this Wednesday. new preparation phase to create digital eurothat will last for someone else two yearsUntil November 1, 2026. The monetary authority started its work at the end of 2019 and has now completed its work. research phase It started in October 2021. At the same time European Commission Presented last June bill The legal framework for the digital euro is currently expected to be discussed by the European Council and Parliament. final decision About creating virtual currency not received It will come from the ECB, but it will not come until the legal framework in question is approved.
Fabio PanettaThe ECB’s executive adviser overseeing the study assured in May that the digital euro could be launched in 2020. “three or four years” I’m counting from this October, so end of 2026 or 2027. However, some sources familiar with the process predict that the arrival of the digital euro may be delayed until 2020. Between 2027 and 2030. Juan Ayuso, General Manager of Operations Bank of SpainHe gave clues about this at the Cunef conference held in July: “A new phase, which will be called preparation, will be opened in October. There is no standard for how long this will take, but as a reference in the final processes. Preparatory phases of this magnitude have lasted.” five and a half years six and a half years“.
Therefore, the currently opened phase will serve the following purposes: complete the rules will manage the digital euro and suppliers who will develop technological platform and infrastructure. Additionally it will include: evidence Thus, the currency meets the requirements set in terms of user experience, privacy, financial inclusion and environmental footprint. “We need to prepare our currency for the future. We need to make the digital euro a digital money shape can be used for this all digital paymentsfree and meeting the highest standards privacy criteria. “This will coexist with physical money, which will always be available, so no one is left behind,” ECB president Christine Lagarde said in a note distributed by her organisation.
Reasons and usefulness
the only money value is guaranteed currently in the hands of the central bank physically: euro coins and banknotes. Money in the hands of citizens banks are private money, but the important thing is that it can be converted into public money by withdrawing cash at any time. Therefore, public money monetary anchor (Companies accept card payments because they know they can convert them into an equivalent amount of public money). This makes it easier for public money to fulfill its role. unit of account (prices are in euros). HE the rise of digital paymentsAccelerated by the pandemic, central banks are announcing that they are trying to create digital currencies to continue serving as monetary anchors.
The project, digital euro unrequited for citizens who can use them to realize payments between peopleat points of sale physicallyin payments digital and in transactions public sector. It would be like cash compulsory admission in addition to being available to both physical and digital businesses (except very small ones), both connected and It’s like without the internet. It can be accessed at: bank apps or through a The application that the ECB will create. People without a bank account can also use it; for example issued card with a public institution such as Mail. Likewise, it can be converted into cash at ATMs.
Challenges and advantages
Many technical and operational problems such as these remain to be solved. ensure security and privacy of your payments. This is one of the issues that raises the most doubts about the ECB. engaged not being able to see personal information Users or their payments. Another important thing is that you want avoid Citizens brought their belongings en masse money from banks to central bank. To make loans, organizations must hold deposits; Therefore, if they did not have deposits, they would not be able to provide loans. finance the economy and liquidity and solvency will be compromised. Also, it will make it harder to fight against inflationBecause ECB interest rate increases are transmitted through loan and deposit interest rates. Therefore, it is being investigated that virtual wallets a digital euro maximum limit (Talking about 3,000 euros), but since the wallets in question will be linked to bank accounts, larger payments can be made.
There is one of these in Spain payment ecosystems This is not the case in other countries in the euro zone, which are the largest and most developed on the continent, but would benefit from the creation of the digital euro. Additionally, there is no European digital payment method that is universally accepted across the Eurozone. intercountry transfers or payments abroad they would be guaranteed. Likewise, it will be in your favor financial inclusionBecause people who do not have access to a bank account can also make digital payments with cards belonging to public institutions. Another advantage is that progress will be made. strategic autonomy The European payment system is currently dominated by foreign companies.