ECB stresses the importance of online and physical stores accepting CBDC

European Central Bank’s or ECB executive board member, Fabio Panetta, talked about the importance of the potential rollout of a digital euro and its ability to be used at online and physical stores could be its key feature.

The major goal of a digital euro is to keep central bank money accessible and usable in an increasingly digitized economy. However, in order for a digital euro to serve this purpose, people need to be able and willing to adopt it.

Panetta outlined the findings of ECB focus groups on digital payment systems, which were conducted in September 2021, and found that people were more inclined to accept a digital euro that could be used in both physical and online stores and allowed for convenient person-to-person payments. To see adoption trends similar to those seen with the currency euro 20 years ago, all merchants would have to accept a digital euro.

“From the outset, I have stressed that a digital euro can only be successful if it meets the payment needs of Europeans today and in the future,” Panetta states.

ECB compares cash payment with CBDC

The second-most-valued feature was instant, easy, contactless payments, especially for person-to-person sales. Cash has dominated person-to-person transactions so far. The ECB has noted that consumers will continue to have access to cash. However, the focus groups reflect previous findings: people are increasingly preferring digital payments. Contactless person-to-person payments may increase extremely quickly when convenient digital solutions become available, according to the experience of nations both inside and outside the euro area.

ECB said that it would carefully study how to develop an engaging digital euro product that answers to the expectations of both payers and payees in the next months, based on the findings of the focus groups.

ECB has been exploring the development of a CBDC as interest in them seems to be growing among different governments around the world. After the Bahamas became the first nation to release CBDC in October 2020, multiple countries accelerated their research and development process for the same. China, which began trials in digital yuan the same year and recently launched a test wallet, also rules the sector. Binance CEO Changpeng Zhao had even been heard saying that China CBDC is good for the industry, as we reported.

In February, the European Commission revealed its plans for CBDC and hinted at a roll-out in 2023.