Digital Euro for everyone

The digital euro could introduce a new form of public money for everyday payments. This article breaks down what it would change in practice, what would stay the same and how people in the EU would benefit.

Family paying restaurant bill digitally
The digital euro is front and centre in Brussels debates ranging from digital policy to geopolitics and European strategic autonomy.

For many, though, the question is simpler: what would the digital euro change in everyday life?

The digital euro has the potential to reshape how people pay in the eurozone. While it wouldn’t replace the financial services banks provide, it would give people a new electronic payment option that’s more widely accessible and less dependent on private providers.

To fully understand the digital euro, though, it starts with what changes and, importantly, what doesn’t.

A simple way to understand the digital euro
Public money in digital form
In the eurozone today, cash is the only type of money issued by a central bank that people can hold directly. The sole form of money that’s guaranteed, your ability to use cash doesn’t depend on a private intermediary, and it’s always redeemable at face value. In today’s digital economy, the need for a public form of electronic money is growing.

The digital euro would be a form of public money issued by the European Central Bank, designed to provide an additional option for digital payments alongside private services. In simple terms, it would be the digital equivalent of cash.

How the digital euro differs from bank money and crypto
Money held in a bank account is issued by a private institution. While it’s regulated and generally safe, it ultimately depends on the stability of the banking system.

Cryptocurrencies, meanwhile, are digital assets created by individuals or open source communities. Not backed by any central authority, they’re often highly volatile.

The digital euro would sit in a different category. Central bank-issued and backed by public authorities, it would add another layer to a system dominated by private digital payment providers.

Digital payments don’t work for everyone
While widely used, electronic payments don’t work in the same way for everyone. Being able to pay digitally mostly depends on having a bank account, relying on the provider to carry out basic onboarding, or meeting certain eligibility requirements, such as possessing the necessary identification and documentation.

For certain vulnerable groups, this means practical barriers. Maintaining an account can be difficult, if not impossible. A 2024 Finance Watch study found that in some EU Member States, nearly 31% of the population over the age of 15 did not own a bank account. One reason is that payment accounts, including basic ones, sometimes carry high fees.

Payment providers also charge merchants with transaction fees every time a customer makes a payment through the provider’s platform. These costs then pass to consumers via higher prices for goods and services, affecting millions in the EU at risk of poverty or social exclusion.

What’s more, not all digital payments are accepted everywhere, especially for low-value transactions, and current solutions may not function in the event of power outages or cyber attacks.

In a handful of European countries, current rules even allow merchants to lawfully not accept cash.

Taken together, these gaps point to the broader issue of payment resilience – reducing the number of points where access can fail and increasing choice in how people pay.

Despite efforts by some to undermine the digital euro, it could remedy these everyday difficulties faced by people across the EU.

As the digital euro’s payment infrastructure would be provided by the European Central Bank, merchant fees would be lower than those currently charged by private payment service providers, benefitting businesses and consumers alike.

Intermediaries would provide basic digital euro payment accounts, a lifeline for the unbanked in circumstances where cash isn’t an option.

A payment option for all
Access to public money in digital form shouldn’t depend on specific providers or commercial conditions. That’s why the digital euro would function as part of the basic payment infrastructure. It would be available to all individuals and businesses in the eurozone, regardless of where they live or currently make payments.

Reflecting the role of cash, the digital euro would be designed to fit into daily life, with no advanced technical knowledge or financial expertise needed to access it.

In that sense, it can be understood in the same way as other essential services: public infrastructure such as transport or healthcare, both intended to be broadly accessible and not limited to specific users.

How the digital euro could work
How people access the digital euro ultimately depends on the final legislative design decisions, still under discussion. But current proposals do shed light on how real-world participation could look.

The digital euro would function through a digital wallet, app or payment card. Designed to work in familiar ways, paying with digital euros would be similar to paying via mobile banking applications or other digital payment platforms.

You could use it to:

Make payments for online purchases or in brick-and-mortar stores
Send money to other people
Receive payments, such as wages or transfers