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The European Parliament has voted in favour of establishing a digital euro, marking a significant milestone in the European Union’s efforts to introduce a central bank digital currency (CBDC). The decision clears the way for final negotiations with EU member states on the legal framework governing the digital currency, with a potential launch targeted for 2029.
The vote reflects growing momentum behind the European Central Bank’s (ECB) digital euro initiative, which policymakers view as a strategic step towards strengthening Europe’s monetary sovereignty and reducing dependence on foreign-owned payment networks for everyday transactions.
Parliament approved the proposal with 416 votes in favour, 169 against, and 22 abstentions, following earlier backing from its Committee on Economic and Monetary Affairs. The outcome paves the way for interinstitutional negotiations between the European Parliament and the Council of the European Union, representing member states.
Fernando Navarrete Rojas, the Parliament’s rapporteur on the digital euro legislation, will lead the negotiations, with the first round of discussions expected to begin under the Irish Presidency of the Council.
Under the proposed framework, the digital euro would be issued directly by the European Central Bank as a secure, private and free-to-use digital payment option for consumers and businesses. The CBDC is expected to support both online and offline transactions, providing an additional public payment instrument alongside cash and existing electronic payment systems.
The legislation also proposes that most merchants within the euro area be required to accept digital euro payments. To address concerns over financial stability, the framework includes limits on the amount of digital euros individuals can hold.
Basic services associated with the digital currency—including opening an account, holding digital euro balances, managing funds and accessing at least one payment instrument—would be provided free of charge.
In addition, banks and payment service providers based in non-euro EU member states would be permitted to distribute the digital euro, broadening access across the bloc while supporting interoperability.
The proposal also reinforces the continued role of physical cash. EU member states would be required to maintain access to cash services, ensure businesses continue accepting cash payments, and regularly monitor cash availability, particularly for vulnerable and digitally excluded populations.
The European Central Bank has indicated that technical testing of the digital euro is expected to begin in 2027, ahead of a possible public rollout in 2029, subject to the successful conclusion of legislative negotiations.
Speaking previously on the initiative, Fernando Navarrete Rojas said Europe does not have to choose between a public digital currency and private payment solutions, noting that both can coexist within an integrated payments ecosystem.
According to him, the legislative proposal promotes a dual approach by encouraging the reuse of existing payment infrastructure and standards, enabling European payment providers to achieve greater interoperability while strengthening cross-border digital payments across the European Union.
The digital euro project forms part of the EU’s broader strategy to modernise its payments landscape, improve resilience, foster innovation and ensure that European consumers retain access to a trusted public form of digital money as payment technologies continue to evolve.
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