The European Central Bank (ECB) is advancing plans for a digital euro pilot, with Executive Board Member Piero Cipollone announcing the selection of payment service providers (PSPs) will begin in early 2026. The 12-month test phase is scheduled for the second half of 2027. The initiative aims to protect European banks and card schemes from competition posed by stablecoins and international payment networks, while keeping licensed PSPs at the core of the Eurozone’s financial system.
The European Central Bank (ECB) is progressing toward a digital euro pilot, targeting the selection of payment service providers in early 2026. Executive Board Member Piero Cipollone outlined that a 12-month test will commence in the second half of 2027, stating it would involve a limited number of PSPs, merchants, and Eurosystem staff. The pilot offers participating providers an early advantage for a potential broader rollout. It provides clearer visibility on future costs and allows direct influence on the digital euro’s design.
Cipollone emphasized the project is designed to protect European card schemes and keep banks central to payments. “Banks could lose their role in payments not just because of stablecoins but also due to other private solutions,” he said, according to Reuters. The digital euro aims to safeguard domestic projects like Italy’s Bancomat and Spain’s Bizum. It will also feature a merchant fee structured to preserve their competitiveness.
“The cap on the fee that merchants will pay on the digital euro network will be lower than what the international payments network, normally the costlier, charge, but higher than what domestic payments scheme, normally the cheapest, charge,” Cipollone said. The move follows the ECB’s formal transition to the next project phase in October 2025, which targeted a launch in 2029. The central bank had projected a 2027 pilot start if legislation is enacted during 2026.
