The ECB sees the digital euro as key to reducing Europe’s reliance on foreign payment providers and enabling regional innovation.
It’s unusual for a central banker to echo the geopolitical rhetoric of Charles de Gaulle, but it’s precisely what Piero Cipollone did this week when addressing France’s Payments Forum in Paris.
Today (May 15), in a wide-ranging speech on the digital euro and European payment sovereignty, the ECB Executive Board Member made the case that Europe’s payments market is structurally dependent on foreign providers — a condition he argued must be addressed not just for competitiveness, but for sovereignty.
“Currently, nearly two-thirds of euro area card-based transactions are processed by non-European companies,” Cipollone noted, citing ECB data. In 13 eurozone countries, he added, “in-store payments rely entirely on international card schemes or mobile solutions.”
The speech marked one of the ECB’s most direct statements to date on the need for a digitally-native form of central bank money to secure Europe’s financial infrastructure in the face of accelerating digitisation and global competition.
“There is no true sovereignty without sovereign money,” Cipollone stated. “Our overreliance on foreign payment providers makes us dependent on the kindness of strangers at a time of heightened geopolitical tensions.”
While physical cash continues to play a role, digital payments now dominate day-to-day consumer activity. Cash made up just 24% of transaction value in the euro area last year, according to the ECB. Meanwhile, online commerce and mobile payment adoption are increasing, with platforms like PayPal and Apple Pay further entrenching their presence — often relying on US card schemes.
Cipollone warned this trend could soon extend to foreign stablecoins, 99% of which are dollar-denominated: “Without a digital euro, our dependency could grow.”
Boosting competitiveness and restoring reach
Another focal point of Cipollone’s remarks was the lack of a pan-European card scheme, which he linked to limited innovation and market fragmentation.
“European payment service providers focus on their home country and struggle to compete on a European level,” he said, arguing that the costs of scaling an acceptance network across the continent are prohibitive without public infrastructure support.
The digital euro and European payment sovereignty strategy, therefore, is intended not only to preserve monetary control, but also to catalyse innovation. Cipollone suggested that domestic card schemes could co-badge with the digital euro, allowing them to reach markets previously served only by international networks.
He also stressed private intermediaries would retain a core role: “European banks would be able to retain their customer relationship and be remunerated for their role in distributing the digital euro.”
Enabling interoperability and use case expansion
The ECB has already launched an innovation platform where over 70 private-sector firms — including fintechs, banks and merchants — are testing digital euro use cases such as conditional payments and offline capabilities. Cipollone confirmed a progress report will be published in July, with the programme extended through June to explore new functionality.
Survey data cited in the speech indicates that public interest in a digital euro is growing, with 45% of euro area respondents now open to using one — up from 28% in 2022.
The proposed legal framework would make the digital euro legal tender and free for basic use, including offline. It would also be governed under European rules, offering a uniform alternative to proprietary solutions.
As Cipollone concluded, the stakes are both economic and institutional: “In the words of the late French economist Michel Aglietta, money is not just a technical device, it is an essential institution.
