Digital euro: Sovereignty, public service, and economic interests at the heart of the EU debate

Brussels – European sovereignty and the geopolitical risks of dependence on US giants. Guided by these fundamental principles, the future of the digital single European currency was the focus of a debate in the European Parliament between MEPs, representatives of institutions, the banking sector, and the business community, in an initiative backed by almost all political groups (The Left, the EPP, S&D, the Conservatives, Renew and the Greens).

Pasquale Tridico (Five Star Movement, in the Left group) brought the focus  to the privatisation of payments, pointing out that today, “two-thirds of our payments are made via credit cards provided by American providers. Do we want our payment system to be dependent on private, non-European companies? We don’t think so.” In support of this view, Ignazio Marino (Independent, with the Greens) expanded on the argument by pointing out how Europe is dependent on the United States for oil, gas, weapons, and even vaccines: “Now is the right time to discuss a public currency in order to establish a Europe that is increasingly independent both as a continent and as a union.”

For MEP Marco Falcone (Forza Italia, in the European People’s Party group), sovereignty must translate into tangible benefits for the end user. He stressed the need to resolve issues relating to deposit limits and compensation. The aim is to create incentives for merchants and citizens that can lead to real “savings in their use.”

“A universal public service” is the concept that Alessandro Giovannini (representing the ECB) sought to convey. He compared the digital euro’s infrastructure to a public transport system, explaining that what they aim to offer is a payment option that is “public, open, reliable, and available to everyone.”

Renew MEP Elisabetta Gualmini also described the new currency as a “common public good” capable of providing resilience against global geopolitical turmoil. Gualmini noted that for “Generation Z,” the use of physical currency now seems “dystopian,” believing that “the move to the digital euro could help Europeans become digital citizens.”

On the technical front, Marco Pieroni (Bank of Italy) confirmed that the infrastructure will be based on systems already in operation, such as “TIPS”, and that Italy will be one of the host countries for the digital euro data centres. However, concerns remain regarding costs: Salvatore Vescina (representative for Confcommercio) expressed fears about fees, urging that they be “fair, i.e. low, uniform, and easy to quantify.” The retailers’ proposal is to set a limit of 0.1 per cent with a cap.

Irene Tinagli (PD, S&D) stressed the delicacy of this phase, noting that incentive schemes must be aligned to ensure that costs and benefits are distributed fairly throughout the value chain. Tinagli suggested adopting a transition phase to test various technical solutions: “For small transactions, a zero fee could be a good design choice to encourage adoption.” According to the Socialist MEP, we must prevent the digital euro from “becoming the next lucrative business captured by major non-European tech players at the expense of European operators.”

In conclusion, Guido Borgato, Italy’s Permanent Representative to the European institutions, reiterated the importance of striking a balance: “We must ensure that the payments industry is able first to recoup its costs and then to make a profit; otherwise, the project simply won’t get off the ground.”

Whether it is safeguarding geopolitical autonomy, ensuring universal public services, or protecting the profit margins of small retailers, the digital currency seems to have brought everyone to the same table, at least for now.