A digital euro and the scope and effects of the legal tender status of banknotes and coins

EESC opinion: A digital euro and the scope and effects of the legal tender status of banknotes and coins

Key points


  • considers that the success of the digital euro project will depend largely on it providing concrete added value, represented by: security, confidence, wide acceptance and easy accessibility without costs for citizens and economic agents. For the EESC, the objective to build the digital euro as European "public good" free of charge is important;
  • underlines the importance to have a clear European legal framework able to establish the exceptional possibility of temporary exemptions for certain (types of) payees, and to harmonise practices and standards that vary from one Member State to another;
  • is of the opinion that in order to ensure the complete acceptance of the digital euro by citizens and economic agents, the European institutions must clearly define the use cases of a potential central bank digital currency (CBDC) and identify appropriate design options regarding key issues (privacy and law enforcement, underlying technology, role of private sector vs. central banks);
  • calls for continued research on and economic analysis of the implications for banking, payments, citizens and businesses in order for the impacts to be properly understood and to allow the potential introduction of this new form of money to be carefully designed, evaluating and comparing operational and infrastructure costs, and the potential impact on financial inclusion and the availability of cash to citizens and on EU open strategic autonomy with the project's benefits;
  • encourages a broad public debate on the reasons for possible issuance of a digital euro, its merits and drawbacks, in order to make informed decisions and ensure public understanding of the project;
  • strongly believes that a digital euro should make the European economy more competitive globally, enable innovation and enhance EU strategic autonomy. Moreover, it could widen the availability, improve the speed, and reduce the cost of cross-border payments and allow smoother exchanges with other currency areas;
  • considers that the ECB should evaluate and monitor on an ongoing basis, how and to what extent Payment service providers (PSPs) should be entitled to recoup investments relating to the set-up of the digital euro's infrastructure and front-end services, given that they stand to benefit, over time, from the shift of retail payments towards digital channels;
  • considers it essential to ensure that the digital euro does not negatively impact financial stability, or the lending potential, provided that the funding base of credit institutions is not unduly affected;
  • considers that the principle of the euro's legal tender status, both cash and digital, should be respected and harmonised rules governing the legal tender status are important aspects of guaranteeing the usability of both forms of the euro;
  • calls for the proposal to undergo a competitiveness check to confirm that it has a positive impact on meeting the declared objectives and on supporting citizens, enterprises, job creation and working conditions.