EU financial chief: Don’t rush digital euro before new Commission in June 2024

The European Commissioner for Financial Stability, Financial Services and the Capital Markets Union, Mairead McGuinness, believes there’s no reason to rush the digital euro until after the next European Parliament elections in June 2024. In her opinion, the European Union’s central bank digital currency (CBDC) project should be approached “quietly and slowly” by the next European Commission, which will be approved by the incoming parliament.

McGuinness mentioned the digital euro during her speech at Brussels-based think tank Bruegel on Sept. 6. She highlighted that the European Central Bank (ECB) would be deciding the project’s fate in October. However, the official added, there’s a necessity to explore this option:

“Cash is less in use. We are using our cards and phones to buy, we’re doing e-commerce and if there were a time when cash was very much diminished then where do we have public money – the central bank public money – if it’s not in cash? We need a digital version of this”

In June, the European Commission proposed a legislative plan for a digital euro. The proposal includes provisions for free essential digital euro services, privacy protection and offline payments. Banks, insurers and funds would have to share customer data with fintech companies in exchange for compensation.

Recently ECB executive board member Fabio Panetta publicly supported the Commission’s plan, calling the European CBDC “a new paradigm for preserving monetary sovereignty”.

The investigation phase of the digital euro project should be completed by October 2023. After that, the ECB will proceed with further development and technical solutions testing.

The 2024 European Parliament election is scheduled to be held from 6 to 9 June 2024. According to EU procedures, the newly elected parliament will then approve or reject the president and other members of the European Commission, whose candidatures would be proposed by the European Council.

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