The European Union Commission Opens Up Consultation on Digital Euro
The European Commission opened a new public consultation on the opportunities and challenges of introducing a digital euro. The Commission launched the consultations as part of its broader efforts to build a more connected, secure, and resilient Union by fostering trust in digital services. The consultation about the digital euro was opened on April 5, 2022.
The Commission is gathering information about the opportunities and challenges of introducing a Central Bank Digital Currency (CBDC). The consultation is geared towards a better understanding of how CBDC would interact with other payment methods.
The European Commission's Directorate‑General for Financial Stability, Financial Services and Capital Markets Union, it’ll assess the potential impact of CBDCs on financial service providers, retail users and the chambers of commerce. The Commission will collect feedback from these three groups until June 14, 2022.
The Commission wants to find out what people think about the role of digital euros in the EU's retail payments and the digital economy, how they can be made available for use at the retail level, and their potential impact on the financial sector and financial stability. The consultation also looks at anti-money laundering and counter-terrorist financing (AML-CFT).
Despite this consultation not being binding for the Commission, it could have weight in decisions like the level of privacy associated with a CBDC. The views collected will help decide how to move forward with a euro-based digital currency, how banks will interact with the system and Europe's interoperability with other digital currencies and payment methods.
As a result of these consultations, the regulator will get helpful information on the expectations of payment service providers, users, and merchants from the digital Euro. It'll also learn how to integrate different responses from the consultations into the EU's retail payment strategy.