Brussels: The European Parliament has voted to support the introduction of a digital euro, approving two amendments to the European Central Bank’s (ECB) annual report that endorse the creation of a central bank digital currency. The amendments were passed with 438 votes in favour and 158 against, highlighting divisions across Europe on the issue.
The proposed digital euro would provide an electronic version of the single currency for use across 21 eurozone countries, allowing individuals to make payments in shops and online at no cost. Supporters argue that it would reduce the EU’s reliance on non-European payment providers such as Visa and MasterCard and strengthen Europe’s financial independence.
Advocates say the digital euro would enable secure online payments using European infrastructure, without dependence on US-based card companies or foreign financial institutions. Critics, however, have raised concerns that a digital currency could allow governments to monitor citizens’ transactions or restrict access to funds.
ECB President Christine Lagarde dismissed these fears, telling MEPs that the digital euro is not intended to replace cash. She stressed that it would be built entirely on European infrastructure and would help avoid over-reliance on foreign providers for critical payment services.
The approved amendment states that a digital euro is essential to enhancing the EU’s financial sovereignty, reducing fragmentation in retail payments, and safeguarding the integrity and resilience of the single market.
The concept of a digital euro was first proposed by the ECB and has been under development for six years. In June 2023, the European Commission formally presented legislative proposals for its introduction. Parliamentary backing was a crucial step after EU member states gave their approval in December, paving the way for the digital euro to move closer to becoming law.
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