The European Central Bank (ECB) does not want to determine the maximum balance for users of the digital euro until the introduction of the digital currency is imminent.
The ECB will also consult with retailers, consumers and banks in determining the holding limit, the central bank said in an interim report on its work on the digital euro. The first discussions have already taken place and more will follow in the coming months.
Amounts between 500 and 3000 euros are discussed
When making this decision, the ECB wants to take both monetary policy and economic aspects into account. At the beginning of June, Bundesbank board member Burkhard Balz said in an interview with the German magazine ‘Focus’ that amounts between 500 and 3,000 euros for the maximum balance are currently being discussed.
The digital euro money as a supplement to cash is intended, among other things, to combat increasing competition in digital payment transactions from American companies such as Paypal or Apple Pay and the rise of cryptocurrencies such as Bitcoin.
The ECB gave the green light in October
In October, the ECB gave the green light for the next steps towards a digital euro. In this preparatory phase, the set of rules must be finalized and providers must be selected for the development of the platform and infrastructure. This phase started at the beginning of November and will initially last two years.
In a letter to the chair of the EU Parliament’s Economic and Monetary Affairs (ECON) Committee, Irene Tinagli, ECB Director Piero Cipollone called for swift completion of legislation in the EU. This is crucial “to give people the freedom to use a digital, public means of payment anywhere in the eurozone and to strengthen collective resilience and autonomy,” Cipollone wrote.
The European Commission presented its legislative proposal for a digital euro in June 2023 and assumed that it would not come into circulation until 2028 at the earliest.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
