Italian banks have expressed their support for the European Central Bank’s (ECB) digital euro initiative. However, they are calling for the implementation costs to be spread out over several years due to the significant financial burden this places on the banking sector.
“We're in favour of the digital euro because it embodies a concept of digital sovereignty,” stated Marco Elio Rottigni, General Manager of the Italian Banking Association (ABI), during a press seminar in Florence. This sentiment was reported by Reuters on Friday.
Rottigni further elaborated on the financial implications, saying, “Costs for the project, however, are very high in the context of the capital expenditure banks must sustain. They could be spread over time.”
These comments emerge as the central bank digital currency (CBDC) project has encountered resistance from some French and German banks. These institutions have voiced concerns that the introduction of an ECB-backed retail wallet could potentially lead to a drain of deposits from commercial lenders.
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ECB Sets 2029 Target for Digital Euro Launch
During its meeting held from October 29–30 in Florence, the ECB’s Governing Council gave its approval to advance the digital euro project into its next phase. This decision follows a two-year preparatory period. A pilot phase is anticipated to commence in 2027, with a full rollout tentatively scheduled for 2029. This timeline is contingent upon the adoption of relevant EU legislation in 2026.
Fernando Navarrete, a member of the European Parliament leading the parliament’s review of the digital euro proposal, recently presented a draft report. This report advocates for a scaled-down version of the digital euro, aiming to safeguard private payment systems such as Wero, which is a joint initiative involving 14 European banks.
Rottigni proposed that Europe should adopt a “twin approach.” This strategy would involve combining the ECB’s digital euro with digital currencies backed by commercial banks. He emphasized the importance of not falling behind in this evolving digital landscape, stating, “What Europe shouldn’t do is fall behind.”
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ECB Signs Deals with Tech Firms for Digital Euro Development
In the previous month, the ECB finalized framework agreements with seven technology providers to support the ongoing development of a potential digital euro. These agreements encompass crucial areas such as fraud and risk management, secure payment data exchange, and software development.
Among the technology firms involved in these agreements are Feedzai, a specialist in fraud detection, and Giesecke+Devrient (G+D), a prominent security technology company.
According to the ECB, the selected firms will also be responsible for developing key features for the digital euro. These features include an “alias lookup” function, which will enable users to send or receive payments without needing to know the recipient’s specific payment service provider. Additionally, the development will focus on offline payment capabilities.
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