From barter to coins to banknotes to cards, the systems Europeans have relied on to facilitate exchange have never stopped evolving. Throughout history, innovations have made these systems increasingly sophisticated, efficient, and convenient. Today, technology is transforming our society at an extraordinary pace. It is only natural then that our currency should also adapt. Europe needs a digital euro for the digital age.
For now, euro cash exists only in physical form – the banknotes and coins we hold in our wallets. Cash brings us together as the most tangible expression of our single currency. We know we can rely on it. It is accepted throughout the euro area. It is easy to use and inclusive. It protects privacy. And it is our money, issued by a public institution, the European Central bank (ECB).
However, more and more Europeans are choosing to pay digitally in shops or buy products online. We therefore need a digital form of cash that would complement the banknotes and coins we are familiar with. The digital euro is designed to respond to the opportunities and challenges presented by this transition.
This is the purpose of the so-called Single Currency Package, presented by the European Commission in 2023. It includes two proposals that are currently being discussed by European legislators.
The first proposal aims to ensure individuals and businesses can continue to access and pay with euro banknotes and coins across the euro area. The ECB is in parallel developing the next generation of euro banknotes with a new design to make them more attractive, relatable and inclusive for all Europeans, while ensuring they remain as secure and sustainable as possible. Euro coins and banknotes are not going anywhere. Europeans will have the choice to pay in euro banknotes and coins or in digital euro. The digital euro is designed to complement, not replace, cash.
The second proposal sets out a framework for a digital euro. This framework provides that the digital euro will be free, simple and inclusive. It will be accepted for any digital payment across the euro area and embed the highest cash-like privacy protection standards. It will work both online and offline, supporting digital payments on websites as well as transactions without internet connection.
In addition, the digital euro should be seen in the broader context of the need to improve Europe's strategic autonomy. Today, our payments landscape is highly dominated by non-European providers. We lack a European digital solution that is accepted for any digital payments throughout the euro area to fill the space left behind by declining cash use.
Ultimately, this makes us dependent on foreign-owned companies in an increasingly polarised and fragmented world. Ceding such a degree of technological control over the EU's economy to others deeply impedes Europe's ability to act autonomously on the world stage. It poses real threats to our resilience and economic security. We therefore must act to reduce the external dependencies that might hinder our freedom to pursue policies in line with our own values and interests.
The digital euro will not compete with private means of payments. It will complement them, making it easier for European private payment solutions to scale up and expand the reach and features they offer.
The year 2026 will be crucial for the digital euro project. At a recent summit, leaders of euro area countries welcomed recent progress and stressed the importance of swiftly completing legislative work and accelerating other preparatory steps. The ECB is preparing for the potential issuance of the digital euro by 2029, assuming the necessary legislation is adopted next year. These preparations will include a pilot that is planned to begin in 2027.
The euro has become a mark of Europe's economic strength and a symbol of European unity in the world. In 2026, the euro area will welcome its 21st member, Bulgaria. The currency that will power the prosperity of 21 euro area countries must now fully embrace the technologies of the 21st century.
The digital euro is an idea whose time has come. It is not just the latest step in the evolution of our money, it is an imperative to promote our strategic autonomy and make the most of the opportunities of the digital age.
