Digital euro crucial for Europe's payment autonomy in fragmented world
ECB Executive Board Member Piero Cipollone highlighted the digital euro's role in strengthening Europe's payment resilience and strategic autonomy. Speaking in Riga, he stressed the need to reduce dependencies on non-European payment infrastructures.
Europe's payment vulnerabilities exposed
Europe faces significant vulnerabilities due to its reliance on non-European payment infrastructure, as highlighted by ECB Executive Board Member Piero Cipollone.
This dependence exposes the continent to risks such as outright withdrawal of access to vital payment systems, extraterritorial legal reach impacting transactions, and the unilateral exercise of market power by dominant non-European providers.
Two-thirds of euro area card transactions are governed by non-European companies, with many states, including the Baltics, entirely dependent on international card schemes for in-store payments.
Between 2018 and 2022, average net merchant service charges in the EU almost doubled, as schemes expanded fee categories outside regulatory caps.
This burdens smaller retailers and increases consumer prices.
The rapid decline in cash use, from 68% of day-to-day transactions in 2019 to 40% in 2025, further amplifies this reliance on external digital payment solutions.
The digital euro's strategic benefits
The digital euro is the Eurosystem's response to Europe's payment vulnerabilities, designed as a digital form of cash and legal tender, available online and offline.
It reduces excessive dependence on non-European providers by ensuring a fully European infrastructure, governed by European rules and working exclusively with EU-registered providers.
This guarantees Europe's independent transaction processing.
Designed for continuity, it features distributed infrastructure and offline functionality to prevent disruptions.
It also mitigates market power concentration by eliminating scheme or processing fees, reducing costs for merchants and fostering competition among European payment companies through open standards, strengthening strategic autonomy.
Beyond convenience: A geopolitical imperative
This speech frames the digital euro not merely as a technical upgrade but as a critical geopolitical tool for European sovereignty.
The detailed exposition of payment vulnerabilities underscores the urgency, moving the debate beyond mere convenience to strategic necessity.
However, successful implementation will hinge on broad adoption, which still requires significant public and private sector buy-in.