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Companies across Europe are set to take part in the European Central Bank’s (ECB) innovation platform for its digital euro project, as the central bank continues to woo the market with its divisive retail payments vehicle.
The new innovation platform is part of the ECB’s ongoing digital euro project, and involves partnering with nearly 70 market participants across the financial and technology sectors.
The initiative aims to test payment functionalities and explore forward-looking use cases for a potential central bank digital currency (CBDC) in the euro area.
Stakeholders include financial institutions Caixa Bank and Erste Bank, as well as payments firms Worldline and Redsys.
The project extends beyond Eurozone companies, and has input from UK and Swiss firms.
Following a call for interest issued in October 2024, the ECB received more than 100 applications from a diverse range of applicants, including banks, fintechs, merchants and start-ups.
“We welcome the huge amount of interest that market participants have shown in this exciting initiative,” said ECB board member Piero Cipollone.
“The breadth and creativity of the proposals highlights the digital euro’s potential as a catalyst for financial innovation in Europe, including the development of new solutions that further enhance the payment experience for Europeans and create market opportunities."
Pioneers and visionaries
The platform simulates a future digital euro ecosystem, with the ECB providing core technical infrastructure and support. Participants, acting as intermediaries, are being encouraged to design and test new digital payment services and features on top of this framework.
The participants have been divided into two parallel work streams: “pioneers” and “visionaries”.
The pioneers group is focused on technically implementing conditional payments, with transactions that are automatically executed when predefined conditions, such as the delivery of goods, are met.
Participants will explore how to integrate the ECB’s simulated digital euro interface with their own platforms, using technical specifications including APIs provided by the ECB.
Each participant will independently develop use cases tailored to their services, and their findings will be submitted to the ECB in a comprehensive report to help inform the central bank’s ongoing design and assessment work for the digital euro.
The visionaries stream, meanwhile, is exploring longer-term use cases and how the digital euro could address broader societal challenges, particularly digital financial inclusion.
One concept under discussion is offering access to digital euro wallets through public service points such as post offices, potentially enabling availability even for individuals without bank accounts or smartphones.
Participants in this group will present and refine their ideas in a series of workshops with ECB officials, running until the end of May 2025.
The ECB plans to publish a detailed report later this year summarising the outcomes from both workstreams, and these findings will contribute to the broader debate around the role of a digital euro in Europe’s future payments landscape.
Not just a public sector matter
By inviting a wide range of participants, from banks and fintechs to merchants and start-ups, the ECB is taking a hands-on, collaborative approach with the private sector.
This may help warm market participants up to the project, which has so far been received coldly across both the private sector and the political space.
Rather than developing a CBDC in isolation, the central bank is involving private actors early on, providing technical tools such as APIs and encouraging co-creation of both technical features and broader societal use cases.
This reflects a desire to make the digital euro more relevant and innovative, and more likely to gain traction across the market. If the digital euro fails to take hold as a worthwhile option, then it will not have been worth the public money that has been spent on the project, which has been ongoing in one form or another since 2020.
At the same time, the decision to involve only European companies, while notably excluding major US payments players like Visa and Mastercard, reveals a deliberate strategy to promote European payment sovereignty — something many are unlikely to find surprising.
The inclusion of UK and Swiss firms indicates a willingness to collaborate beyond the EU, but still within a European framework, reflecting a broader policy goal that has been stated by the ECB’s officials, including its president, Christine Lagarde.
This goal is to reduce dependence on non-European infrastructure, foster homegrown innovation, and align with the EU’s wider push for digital and financial autonomy.
Recent geopolitical developments have made the ECB and its counterparts in Brussels nervous about the EU finding itself stuck due to a tariff problem.
The rush to reduce reliance on external jurisdictions has only intensified, but this time perhaps with the European payments industry onside, too.
