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By inviting payment service providers (PSPs) to participate in a 12-month trial to assess the operational readiness of the digital euro, the authority is giving them insight into its functionality and the chance to influence its further development.
Under the plan, selected PSPs will collaborate with the Eurosystem, which comprises the European Central Bank (ECB) and the national central banks of the 20 EU member states that use the euro, to develop and test pilot payment use cases.
The pilot will involve real-world transactions between individuals and businesses using a digital payment instrument issued by the Eurosystem. Although designed to replicate the digital euro’s features, it will not constitute legal tender.
The trial will cover person-to-person (P2P) and person-to-business (P2B) transactions, both online and offline, allowing PSPs to test a full spectrum of payment scenarios.
Selected PSPs will include both distributing and acquiring providers; organisations may apply as either or both.
The pilot is set to last for 12 months and is intended to test the technical, functional and operational readiness of the digital euro.
Announcing the pilot activities, the Eurosystem said they would “play a key role in preparing Europe’s payment ecosystem for the possible introduction of the digital euro. They will provide a valuable learning experience, helping to further improve the digital euro’s functionalities, usability and technical design.”
In pursuing the digital euro, the EU is attempting to modernise the payments system through digital assets and give consumers in the euro area access to a secure, resilient public digital payment option.
This reflects a strategic push to enhance monetary sovereignty and modernise retail payments.
First-hand experience of the digital euro
In October 2025, the ECB announced that it was ready to move to the next phase of the digital euro project, aiming for potential launch in 2029.
At that point, working on the assumption that European co-legislators would adopt a regulation on the establishment in 2026, the bank suggested that a pilot exercise and ‘initial transactions’ could take place in mid-2027, followed by a potential first issuance of the digital euro during 2029.
Under the newly announced plan for a pilot scheme, selected participants will gain first-hand experience of a simulated digital euro ecosystem and their feedback will further shape its technical specifications. Their participation will not be remunerated.
In addition to gaining operational insight, PSPs participating in the pilot will be able to identify integration challenges, test transaction processing and customer interfaces and refine internal systems in advance of the digital euro’s full-scale rollout.
This early engagement provides a strategic advantage: PSPs can influence design choices, mitigate operational risks and position themselves as leaders in digital euro services before the broader market adopts the central bank digital currency (CBDC).
In advancing the digital euro project, the EU is moving ahead of other major central banks.
The US has committed to a private sector-led approach to digital assets, based on stablecoins, and the Bank of England is taking a highly cautious approach, exploring the idea of a digital pound carefully before committing to implementation.
This gives the EU a potential first-mover advantage among major economies in developing CBDCs, but also introduces risks of implementation challenges that may require course corrections.
A multi-stage process
The Eurosystem has outlined its plan for the pilot. First will be an assessment phase, during which the call for expression of interest will be published, PSPs’ applications will be evaluated and applicants will be notified of the selection outcome.
There will then be a preparation phase, when pre-selected PSPs will be given updated documentation and be asked to confirm their interest in participating in the pilot and sign the participation agreement.
Next is the implementation phase, when the selected PSPs and the Eurosystem will refine the operating system, conduct testing, onboard end users, process digital transactions and collect feedback.
Finally, in the execution phase the Eurosystem and the selected PSPs will onboard end users, process transactions and collect feedback.
Given that the planned intermediation model for the digital euro places them in a central role in distributing the CBDC, PSPs should consider participating in the trial.
According to the Eurosystem, “Participation in the piloting activities is a unique opportunity for PSPs to help shape the next generation of digital payments in Europe.”
The authority argues that participating PSPs will gain valuable experience of the technical specifications of the digital euro and will have the chance to provide feedback that will be used to shape its development.
Given that participation in the pilot is not remunerated, the immediate financial benefit is limited. However, the strategic value is potentially significant: PSPs should gain insights into potential regulatory requirements, operational workflows and technical standards.
By being involved in the trial, they will have the opportunity to influence the digital euro’s usability, security protocols and settlement processes, all of which could directly affect firms’ competitive positioning and future product offerings.
For the broader European payments landscape, the pilot is more than a technical exercise: it could be a key stage in the development of a resilient, interoperable and consumer-ready digital euro.
PSPs that invest time and resources in the trial will be best positioned to navigate regulatory obligations, develop innovative services and capitalise on first-mover advantages when the CBDC moves towards full-scale issuance.
In addition, by participating, PSPs can contribute to shaping a robust and interoperable digital euro ecosystem, which will benefit the wider payments market.
