ECB Analysis Shows Privacy as Biggest Concern in Use of Digital Euro
ECB concluded the public consultation on the introduction of a digital euro in EU. ECB received a record level of feedback on this consultation, with about 8,221 responses, and is in the process of conducting a detailed analysis of the responses received. ECB plans to publish a comprehensive analysis of the public consultation in the Spring, which will serve as an important input for the ECB Governing Council when deciding whether to launch a digital euro project. However, an initial analysis of raw data showed that privacy of payments ranked highest among the requested features of a potential digital euro (41% of replies), followed by security (17%) and pan-European reach (10%).
The public consultation was launched on October 12, 2020, following the publication of the Eurosystem report on a digital euro. The Eurosystem task force, bringing together experts from ECB and 19 national central banks of the euro area, identified possible scenarios that would require the issuance of a digital euro. These scenarios include an increased demand for electronic payments in the euro area that would require a European risk-free digital means of payment, a significant decline in the use of cash as a means of payment in the euro area, the launch of global private means of payment that might raise regulatory concerns and pose risks for financial stability and consumer protection, and a broad take-up of central bank digital currencies issued by other central banks. A digital euro would be an electronic form of central bank money accessible to all citizens and firms—like banknotes, but in a digital form—to make their daily payments in a fast, easy, and secure way. The protection of privacy would be a key priority, so that the digital euro can help maintain trust in payments in the digital age. It would complement cash, not replace it. The Eurosystem will continue to issue cash in any case.
Keywords: Europe, EU, Banking, PMI, Digital Euro, Digital Currencies, Suptech, CBDC, ECB
Victor Calanog, Ph.D.
Leading economist; commercial real estate; performance forecasting, econometric infrastructure; data modeling; credit risk modeling; portfolio assessment; custom commercial real estate analysis; thought leader.
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