The European Central Bank aims to finalise key technical standards for a potential digital euro by this summer, allowing banks and merchants to begin preparing their systems.
ECB Executive Board member Piero Cipollone said the standards would enable payment providers to embed digital euro functionality into terminals and apps ahead of any formal issuance decision.
The central bank expects EU legislation to be in place by 2026, with Cipollone noting that early preparation would give European firms a head start in adoption.
A pilot programme is scheduled to begin in the second half of 2027 and run for 12 months, testing peer-to-peer and point-of-sale payments in a controlled environment.
The ECB estimates the digital euro could cost banks between 4 billion and 6 billion euros over four years, but said these costs should be weighed against long-term benefits such as reduced reliance on international payment schemes.
The digital euro is designed as a public payments infrastructure used by private intermediaries, rather than a direct retail product from the ECB, and is intended to complement cash and bank deposits.
The initiative is part of a broader push toward tokenised financial systems, including projects exploring central bank money as a settlement layer for tokenised securities and digital assets.