Italian banks have thrown their support behind the European Central Bank’s proposed digital euro, emphasizing its role in continental “digital sovereignty” while simultaneously calling for initial implementation costs to be spread over time to ensure the project’s viability.
Marco Elio Rottigni, General Manager of the Italian Banking Association (ABI), confirmed this stance in a press conference. He highlighted the project as a vital step towards safeguarding Europe’s digital autonomy in the face of global financial innovation.
The ABI’s primary condition is that the significant upfront costs for implementing the digital euro should be distributed over time. This approach, they argue, is crucial for making the initiative sustainable for financial institutions.
Rottigni also advocated for a “dual approach,” combining a central bank digital currency (CBDC) with digital currencies issued by commercial banks. This strategy, he believes, would enable Europe to keep pace with other jurisdictions.
He specifically cited the United States, where the GENIUS Act recently regulated privately issued stablecoins. This development underscores the need for Europe to innovate without falling behind, Rottigni stated.
Current plans anticipate an official launch of the digital euro in 2029, following a pilot phase set to begin in 2027. This timeline is contingent on legislative approval expected next year.
The Italian banking sector’s declarations follow an agreement among European Union finance ministers, European Central Bank President Christine Lagarde, and Commissioner Valdis Dombrovskis. This accord established the framework for the digital euro’s development.
Under this agreement, ministers will have a say in the final decision on the currency’s issuance and on potential holding limits for Eurozone residents. These limits are designed to mitigate the risk of large-scale deposit outflows from traditional banks.
Despite Italian support, the project faces criticism from other quarters. The German Banking Industry Committee, a major lobby group, has expressed reservations about the initiative.
Conservative Member of European Parliament (MEP) Fernando Navarrete also voiced skepticism. He proposed a more limited version of the digital euro, focused solely on offline payments, as reported by the Financial Times.
Navarrete argued that the digital euro should not be used for wholesale payments between financial intermediaries or other market players. He noted that existing central bank money settlement systems already serve these purposes, and the Eurosystem is exploring other suitable technological options.
The European Central Bank maintains that the digital euro is not intended to replace cash or eliminate banking intermediation. Its core objective is to provide a secure, European alternative to the dominant global digital payment systems.
For Italian banks, the challenge involves balancing infrastructure investment with the need to remain competitive. The ABI trusts that a clear regulatory roadmap and a distributed cost model will enable Europe’s financial system to embrace digitalization while preserving market stability.
As the pilot phase approaches, the debate surrounding the future of money in Europe is intensifying.