“Payment habits and methods are changing, however the expectations of individuals and businesses remain the same, such as the ability to make payments securely, conveniently, at any time, with or without an internet connection. The digital euro would meet these expectations by ensuring that payments can be made at all times and in all circumstances across the euro area, both in the digital environment and at physical points of sale,” says Evaldas Ruzgys, Member of the Board of the Bank of Lithuania.
Cash can be used for payments at physical points of sale, but not in e-commerce. Meanwhile, payment cards and e-commerce solutions usually do not work when there is no internet connection. The digital euro would fill this gap, since it would function as electronic money but would ensure privacy (close to cash) and would work at the physical point of sale or between two persons even when there is no internet connection.
The digital euro would be distributed by payment service providers including banks and could be used for payments both in physical stores and online, as well as for sending money to friends. In physical retail locations, you would even be able to make payments offline using either a smartphone or a payment card.
Currently, there is no digital payment instrument in Europe that can be used across the euro area. In 15 out of 21 countries, there are no significantly used domestic solutions for digital payments in shops. They account for nearly two thirds of all card payments in the euro area. The digital euro would be a European electronic payment instrument available and accepted in all euro area countries.
The digital euro project began in 2021. The first phase, namely the investigation phase, lasted until November 2023. This was followed by the preparation phase, which lasted until the end of October 2025. The Governing Council of the ECB then decided to move to the next phase, which focuses primarily on technical preparations for the launch of the digital euro. The pilot project is scheduled to begin in the second half of 2027 and would last for one year. Subject to legislative developments, the entire Eurosystem should be ready for the potential issuance of the digital euro by 2029. The Bank of Lithuania is actively participating in all stages of the digital euro’s development.
During the pilot project, the infrastructure will be evaluated in real-life scenarios, such as making payments in physical stores or peer-to-peer payments. Payment service providers licensed in the euro area will be selected to participate in the project. Currently, more than 50 entities have expressed interest in participating. The project will also involve merchants and staff of the central banks of the Eurosystem, who will test the beta version of the digital euro in everyday life, such as when paying in a café or for other services.
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