Rising geopolitical tensions are strengthening the case for a European-controlled digital payments system, according to European Central Bank executive board member Piero Cipollone.
Cipollone said Europe must safeguard its ability to make everyday payments without relying heavily on non-European providers amid growing global instability.
In an interview with Spanish newspaper El País, Cipollone described the digital euro as public money issued in digital form to complement physical cash.
He said the digital euro would help address fragmentation in Europe’s payments landscape as e-commerce and digital transactions continue to expand.
Cash accounted for around 24% of the value of day-to-day transactions in 2024, down sharply from 40% in 2019, according to Cipollone.
He argued that the ECB has a responsibility to adapt the way it provides money as a public good as payment habits shift.
Cipollone linked the digital euro project directly to geopolitics, warning that financial tools are increasingly being used as strategic weapons.
The weaponisation of every conceivable tool makes it essential to have a European retail payment system fully under our control.
Piero Cipollone said.
He stressed that such a system should be built on European technology and infrastructure rather than relying on foreign schemes.
Cipollone said Europe must avoid creating excessive dependencies on non-European payment providers that could expose the bloc to external pressure.
He highlighted that the digital euro would have legal tender status across the euro area once introduced.
Cipollone noted that any merchant currently accepting digital payments would be required to accept the digital euro.
This requirement would effectively create mandatory acceptance of the digital euro for digital transactions across the eurozone.
Cipollone rejected arguments that the project should be delayed in favour of waiting for a purely private sector alternative.
He said the ECB has urged the private sector for years to develop a pan-European payments solution, with limited success.
Cipollone argued that a digital euro based on a single open standard could help unify Europe’s fragmented retail payments market.
He said such a standard would encourage banks and fintech firms to innovate rather than be crowded out by the central bank.