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Italian financial institutions have voiced their endorsement for the European Central Bank’s (ECB) digital euro project, yet they are advocating for the costs of implementation to be distributed over multiple years due to the financial strain it imposes on the industry.
“We support the digital euro as it represents a notion of digital autonomy,” stated Marco Elio Rottigni, General Manager of the Italian Banking Association (ABI), during a press conference in Florence, Reuters reported on Friday.
“The expenses for the initiative, however, are significantly high in light of the capital investments that banks must undertake. They could be amortized over time,” Rottigni remarked.
These remarks arise as the central bank digital currency (CBDC) initiative encounters opposition from certain French and German banking institutions, who are concerned that the launch of an ECB-backed retail wallet could siphon deposits from commercial banks.
Related: Digital euro CBDC is ‘symbol of faith in our shared future’ — ECB chief
ECB establishes 2029 deadline for digital euro introduction
During its meeting on October 29–30 in Florence, the ECB’s Governing Council sanctioned advancing the project into its subsequent phase following a two-year preparatory stage. A trial phase is anticipated to commence in 2027, with a complete deployment tentatively planned for 2029, contingent upon the adoption of EU legislation in 2026.
Member of the European Parliament Fernando Navarrete, who is overseeing the parliament’s evaluation of the proposal, recently introduced a draft report advocating for a reduced-scale version of the digital euro to safeguard private payment systems like Wero, a collaborative initiative by 14 European banks, according to the report.
Rottigni asserted that Europe ought to adopt a “dual approach,” merging the ECB’s digital euro with digital currencies backed by commercial banks. “What Europe must avoid is lagging behind,” he emphasized.
Related: Malaysia’s central bank outlines a three-year roadmap to pilot asset tokenization
ECB finalizes partnerships with tech companies for digital euro advancement
Last month, the ECB completed framework agreements with seven technology firms to aid the progression of a potential digital euro. The agreements encompass fraud detection, risk management, secure payment data transmission, and software development.
Among the participating companies is fraud-detection expert Feedzai and security technology firm Giesecke+Devrient (G+D).
As per the ECB, the chosen firms will also devise functionalities such as “alias lookup,” allowing users to execute payments without the necessity of recognizing the recipient’s payment service provider and offline payment features.
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