Progress continues on the path of the creation of the digital euro as the European Central Bank (ECB) and Eurosystem have begun seeking for firms to join in an exercise to prototype customer-facing payments systems. Payment service providers, banks and other relevant firms were asked to show interest in the initiative in a statement made Thursday.
Eurosystem, which comprises the ECB and the national central banks of countries that utilise the euro, indicated that it will pick up to five front-end providers on the basis of their capabilities and the use cases they propose. While participants do not necessarily have to have previous expertise with the service they will prototype, the experience will be evaluated in the selection process.
The prototype suppliers will be required to design front-end apps in compliance with the standards of the system’s existing backend and interface. They will be allowed to offer comments on the existing system, including how it might satisfy their technical needs, and they will be invited to propose additional value-added services. Participants will not be rewarded for their contributions but may be included in later phases in digital euro development.
The application date for the project is May 20, 2022. The project will begin in August and is slated to end in the first quarter of next year. The investigation phase of digital euro testing will finish in October 2023. At that time, a decision by the Eurosystem Governing Council is likely to be made on the establishment of a real-world digital euro central bank digital currency (CBDC) (CBDC).
This is the latest in a protracted sequence of measures toward a digital euro, which at times has proven to be problematic. Earlier this month, the European Commission received comments from more than 11,000 individuals regarding its digital euro effort, with members of the public raising worries over surveillance and government overreach. Nonetheless, ECB executive board member Fabio Panetta recently stated the belief that producing a digital euro is “likely to become a necessity.”
This progress shows the giant stride the two organisations are taking to fast track the creation of digital assets and its acceptability among the general public.