ECB Warns EU Law Delays Could Push Digital Euro Beyond 2029

European Central Bank Executive Board member Piero Cipollone warned lawmakers on November 10 that further legislative delays could push the digital euro's potential first issuance beyond 2029. Negotiators need a deal before the end of 2026, he told the European Parliament's Committee on Economic and Monetary Affairs. "A delay in adoption could instead postpone the introduction of the digital euro," Cipollone said.

The timetable matters because the ECB plans a 12-month pilot with 36 payment providers starting in the second half of 2027. Any public issuance still depends on the legislation and a later Governing Council decision on whether and when to issue the currency.

What is holding up the legislation?

The European Parliament and the Council of the European Union have negotiated with the European Commission in trilogues since July. Fernando Navarrete Rojas, a Spanish member of the European People's Party, leads Parliament's team; Ireland chairs for member states and, according to Euronews, aims for a negotiating deal on November 18.

Merchant fees remain unresolved, putting the payment system's commercial terms at the center of the final discussions. The Council adopted its negotiating position in December 2025. Parliament's economic affairs committee approved its position on June 23, 2026, by 43 votes to 14 with one abstention, and the plenary approved the negotiating mandate on July 9 by 416 votes to 169, with 22 abstentions. A further negotiating round took place on November 5, and EU leaders called in March for negotiations to conclude by end-2026.

Cipollone tied the timetable to European payment companies' competitiveness. Card payments in shops in 13 eurozone countries run entirely through non-European firms such as Visa and Mastercard, he noted, and a delayed launch could deepen that reliance while leaving domestic businesses at a disadvantage.

Will Lagarde's exit affect the project?

ECB President Christine Lagarde announced in October that she will step down on February 7, 2027, before the planned pilot. Alessandro Giovannini, adviser to the digital euro program manager, said at the Web Summit in Lisbon that the leadership change would not delay the project. He called it "a European project" and said he did not fear a change in leadership would affect work that spans lawmakers, central banks and private payment companies.

What will the 2027 pilot test?

The ECB selected 36 banks and payment firms in July from more than 50 applicants, including Deutsche Bank, UniCredit and Stripe. In October it chose network providers including Nexi and Telefónica to connect participants to its platform.

ECB employees, staff from 19 national central banks and selected merchants will use a beta version without legal tender status. The exercise will test cafeteria payments, person-to-person transfers and online purchases, covering both in-person and remote spending, and will assess reliability, payment processing and customer experience.

A separate application process for online and mobile merchants opened in September, with selected businesses due to be announced in early 2027. An innovation-testing round between January and June 2027 will examine conditional payments and possible artificial intelligence applications. Giovannini said the first pilot transactions would arrive "in less than one year."

What are the costs and consumer terms?

The ECB estimates development expenditure at approximately €1.3 billion before first issuance, with annual operating costs of roughly €320 million from 2029. Eurozone central banks would bear those costs, as they do for banknotes. Giovannini said the ECB would fund the shared infrastructure and offer it free to participating institutions; merchant-fee arrangements remain under negotiation.

Parliament's position calls for free basic consumer services, including account opening and payments, mandates merchant acceptance subject to exemptions, and restricts fees charged to merchants and payment providers. It also includes individual holding limits, addressing bankers' concerns that customers could shift deposits into ECB-guaranteed wallets.

Giovannini said offline phone-to-phone payments would verify a token's genuineness without leaving a record identifying payer and recipient — comparing the exchange, with a €20 banknote in hand, to handing over cash. Offline payment limits remain under negotiation to address money laundering and terrorist financing. After a T2 settlement outage in early 2025 disrupted banks for much of a day, the ECB said the digital euro would resemble its TIPS instant-payment system, which suffered only minor delays. The currency would pay no interest, Giovannini added.

What about private euro stablecoins?

Qivalis, a consortium backed by 37 banks across 15 countries, received Dutch central bank authorization in October to operate as an electronic money institution. It plans a euro-denominated stablecoin subject to additional MiCA requirements, distributed through banks, exchanges and payment providers, though the token has not entered circulation.

The digital euro now faces three sequential steps: completing the legislation, conducting the pilot, and securing a Governing Council decision on issuance. Ireland's November 18 negotiating target will indicate whether the ECB's 2029 objective stays within reach.