Merchants Sought for 12-Month Trial
The European Central Bank (ECB) is looking for e-commerce and mobile-commerce merchants in the euro area to participate in a pilot of its proposed digital euro, as the institution works toward a potential retail CBDC launch in 2029.
The 12-month experiment is scheduled to start in the second half of 2027. It will test a beta version of the digital currency across several payment scenarios, including online purchases, mobile transactions, in-store payments and transfers between individuals.
Although the test version will be designed to mirror the planned digital euro, it will not qualify as legal tender. The ECB will use the trial to evaluate the underlying technology, operational arrangements and user experience before a possible full rollout.
Merchant Participation Seen as Crucial
Bringing merchants into the trial is important because widespread consumer use would depend on having enough businesses willing to accept the digital euro.
Isadora Arredondo, vice president of global policy at Hedera, told CoinDesk via LinkedIn that the commercial side of adoption could prove more challenging than explaining the currency’s benefits to the public.
Arredondo said merchants would need meaningful incentives to participate in large numbers, while consumers would need a payment experience without unnecessary restrictions or complications.
One potential incentive, she said, would be for payment service providers to reduce the fees merchants pay when processing digital-euro payments.
Banks and Payment Firms Already Selected
The ECB’s merchant recruitment drive follows the selection of 36 banks and payment companies several weeks earlier to take part in the pilot.
The experiment will involve the ECB, the 19 national central banks in the euro area and selected merchants. ECB and national central bank employees will act as users during the trial.
Participants will test both online and offline person-to-person payments, purchases at physical stores, e-commerce transactions and mobile-commerce payments.
The ECB currently expects the pilot to run for 12 months beginning in the latter half of 2027. A potential issuance in 2029 will depend on the adoption of the necessary legislation as well as a separate decision by the ECB’s Governing Council.
ECB Raises Stablecoin Concerns
The legal framework for the digital euro has yet to be completed, but the ECB is continuing its preparations.
A major motivation behind the project is the growing presence of privately issued dollar-backed stablecoins in Europe. Assets such as Tether’s USDT and Circle Internet’s USDC have raised concerns at the ECB about the region’s monetary autonomy.
The central bank sees the digital euro as a way to support a European payment system and reduce the potential impact of greater reliance on private, dollar-denominated digital currencies.
