ECB Allocates $730 Million for Offline Payments in Digital Euro Project

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The European Central Bank (ECB) is taking a significant step toward the implementation of a digital euro by allocating a portion of its $1.3 billion contract budget to enable offline payments for the proposed digital currency. The move indicates the ECB’s seriousness about embracing the digital age and competing with private cryptocurrencies.

More than half of the contract budget around $730 million is specifically earmarked for the development of offline payment capabilities. The ECB has issued calls for applications from various providers to offer a range of services including risk management, information security and user applications with the majority of the budget directed towards the crucial aspect of offline payments.

While central banks worldwide are exploring central bank digital currencies (CBDCs), the European Union particularly the 27-nation Eurozone, has shown notable interest in preparing for a digital euro. The ECB which is responsible for overseeing the euro used by approximately 340 million people in 20 EU countries has been actively exploring the issuance of a digital version of the currency. In 2023, legislative proposals were introduced outlawing interest and large holdings while promising offline payments from day one.

Despite repeated assurances from ECB officials that the work on a digital euro is not a commitment to issue one, the recent calls for providers suggest that legislative promises are putting pressure on the ECB to deliver on its proposals. In addition to the application calls, the ECB recently provided an update on the development of a rulebook for the CBDC.

While the $1.3 billion budget may seem substantial Jonas Gross, chairman of the Digital Euro Association notes that the expectations set by the ECB require a significant investment. Gross emphasized that the budget seems reasonable when considering the complexity of delivering a flawless product in the market over the span of several years.

The focus on allocating more than half of the budget to potential providers of the offline component of the CBDC underscores the importance of overcoming hurdles related to offline payments in CBDC implementation. The ECB plans to introduce two digital euros for retail payments with one exclusively designed for offline use including offline holdings.

The selection of service providers remains an open question considering the ECB’s past scrutiny for choosing Amazon to create an e-commerce prototype for the digital euro in 2022. Gross suggests that the ECB may opt for more traditional finance players with a presence in Europe.


As the ECB advances its digital euro project moving it to a preparation phase in October, the ultimate decision to issue a digital euro hinges on the finalization of legislation in the European Parliament. However, with proposals facing political pushback approval is not guaranteed, adding an element of uncertainty to the future of the digital euro.


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