Key Points
- The EU is pushing to accelerate the creation of a digital euro.
- The goal is to reduce the bloc’s dependence on U.S. payment companies like Visa and Mastercard.
- The move is part of a broader effort to improve Europe’s “strategic autonomy.” The digital euro would be used for both online and offline payments.
- The European Central Bank has said the digital euro could be operational by 2029.
The European Union needs to speed up the creation of a “digital euro” to reduce its reliance on U.S. payment giants like Visa and Mastercard, a top EU official said on Wednesday. The call for urgency comes as the bloc is feeling the heat from the Trump administration’s aggressive use of economic pressure.
“Today, our payments landscape is highly dominated by non-European providers,” said Economic Commissioner Valdis Dombrovskis. “This makes us dependent on foreign-owned companies in an increasingly polarised and fragmented world.”
Almost two-thirds of all card transactions in the EU are currently handled by Visa and Mastercard. Dombrovskis warned that this dominance makes the EU vulnerable and could “impede our ability to act autonomously.”
The European Central Bank has been working on a digital euro since 2020, but progress has been slow. The project has faced a lack of political urgency and some resistance from the banking industry.
However, the recent tensions with the U.S. over issues like the Greenland dispute have “helped focus minds.” European leaders are now seeing the digital euro not just as a way to modernize their payment system, but as a crucial tool for “strategic autonomy.”
The digital euro would be used for both online and in-store payments and would be designed to work even when users are offline. The EU’s 27 governments have already agreed on the basic framework, and once they finish negotiations with the European Parliament, the ECB could issue the digital currency, with a target of making it operational by 2029.
“Europe needs a digital euro for the digital age,” Dombrovskis said.
