Digital Euro Is Too Complex and Hurts European Payments – Report

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Veronika Rinecker is based in Germany, studied international journalism and media management. She specializes in politics and regulation, energy, blockchain, and fintech. Since 2017, she has been...

The digital euro proposed by the European Central Bank (ECB) is too complex, offers limited benefits and could undermine the competitiveness of European payment systems. These are the key findings of an August 2024 study commissioned by the Association of German Cooperative Banks (BVR) and conducted by payment consultancy Paysys.

Researchers from Paysys, including CEO Hugo Godschalk and professors Malte Krüger and Franz Seitz, conducted a thorough review of all published documents and regulatory proposals from the Eurosystem and the European Commission up until June 2024. Their analysis focused on the consistency and feasibility of the digital euro within the European financial market, particularly from the perspective of retailers and consumers.

The researchers conclude that the digital euro, as currently proposed, offers little added value for consumers and businesses. The construct is too complex and incomprehensible for users both in front of and behind the cash register. “For example, the number of parties involved in a payment transaction would increase from the current four (payer, payee and their respective payment service providers) to up to eight, which would complicate and slow down the settlement process,” the three experts criticize.

This added complexity could lead to slower and more expensive transactions. The low costs targeted by the ECB and EU policy are unrealistic, the report says, and incompatible with increasing Europe’s competitiveness.

Professor Malte Krüger of the Technical University of Aschaffenburg,