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The Dutch Banking Association has openly criticised the European Central Bank’s digital euro project, bringing some of the private concerns of many in the payments industry out into the open.
“For a possible introduction of the digital euro, the added value must be demonstrated, including for the general public that will eventually use it,” the NVB, the Netherlands’ banking lobby, has cautioned.
“After all, consumers in the Netherlands can already pay safely, quickly and efficiently.”
The NVB’s criticism comes after plenty of private concerns have been expressed about the digital euro by both payments and banking representatives.
Sources have previously complained to VIXIO that they do not see the use case and that it is solely focused on geopolitics, as opposed to bringing any value to consumers.
A recent conference, organised by the European Central Bank and the European Commission, did very little to persuade stakeholders that the project was worthwhile.
Many complained that it appeared very little had been agreed and felt that both institutions were divided about issues, such as data privacy.
“A decision on actual introduction should therefore only be taken at the end of the entire research phase, during which the contribution to the most important policy objectives can be assessed,” said the NVB.
Although the association welcomed the fact that the Eurosystem is investigating, it warned that far-reaching decisions are already being taken on the technical design of the digital euro.
“This is the wrong order,” argued the NVB.
A decision to introduce the digital euro has a potentially major impact on the quality and stability of the monetary system and European payments, the NVB suggested.
It recommends that in the interest of financial stability and the resilience of the banking system, the function of a public digital euro should in any event be limited to a means of payment. The use as a means of savings or investment, for example, should be avoided.
The NVB said that it is open to innovation and improvement of the European payment infrastructure, but complained that in the current set-up, the introduction of the digital euro brings little added value for Dutch consumers and businesses compared to the currently available means of payment.
“Accessibility to the payment system in the Netherlands is very high and good private payment solutions are available for the proposed application,” the NVB pointed out.
The Dutch banking group has placed itself in contrast to fellow trade associations in the eurozone.
For example, the German Banking Industry Committee (GBIC), collectively representing more than 1,700 banks, published a policy paper in July stating that it sees the digital euro as “key to strengthening Europe’s digital and monetary sovereignty and ensuring the continent’s medium and long-term competitiveness”.
The GBIC further suggested that the global trend towards central bank digital currencies (CBDCs) is “unmistakable”.
Earlier this month, Iberpay, which manages Spain’s national payments infrastructure, and several Spanish banks set up a working group with plans to test the digital euro for contactless in-store payments.
