The digital euro represents a new phase in the development of payment systems in Europe, conceived as digital money issued by the European Central Bank and the national central banks of countries that use the euro.

The idea of its introduction arose due to the growing demand for secure, reliable, and fast electronic payments in the euro area. The digital euro will not replace cash, but will complement it, giving users additional flexibility and payment options, both in online and offline environments.

The Croatian National Bank (HNB) emphasizes that the introduction of the digital euro, planned for 2029, which could begin as early as 2028, does not mean the abolition of cash, namely euro banknotes and euro coins, writes the renowned portal N1. As highlighted, the European Commission and the European Central Bank are working on legislative proposals that will further protect the status of cash as legal tender, and merchants will still be required to accept cash except in cases where another payment method has been agreed in advance.

According to the results of a 2024 survey, demand for cash remains strong across all age groups within the euro area, and citizens want to retain the option of paying with banknotes and coins. HNB explains that the digital euro, although digital, will not have the function of an interest-bearing bank deposit but will serve exclusively as a means of payment. Also, the digital euro will enable payments in offline conditions as well, making it available in cases of internet connection outages or other technical difficulties.

At the same time, privacy is one of the key elements of the digital euro. The Eurosystem, which includes the European Central Bank and national central banks such as HNB, will not have access to users’ personal data nor be able to store it, thereby guaranteeing a high degree of privacy and security protection. The project is currently in the preparation phase, which includes the development of technical infrastructure, the legal framework, and the collection of user preferences. A decision on the next steps is expected by the end of 2025, in cooperation with the European Parliament.

The digital euro is a symbol of the modernization of payment systems in Europe, founded on security, privacy, and accessibility, but also on preserving traditional forms of payment. Cash remains the foundation of the system, and the digital euro brings new possibilities for adaptation for citizens and the economy in the digital age.

The digital euro is not just a technological novelty, but also a response to global trends in the digitalization of financial transactions that are increasingly changing the way people pay around the world. In addition to providing a secure and efficient alternative to cash, the digital euro has the potential to accelerate economic integration and reduce payment costs in the euro area.

Alongside European initiatives, central bank digital currencies (CBDC) are becoming a global trend, and countries such as China and Sweden are already successfully developing their versions of digital currencies. The introduction of the digital euro is expected as a step by which Europe will retain its monetary competitiveness and sovereignty in the digital age.

For end users, the digital euro will be easy to use, enabling payments via mobile applications, cards, and other digital tools, and it will be usable in everyday transactions from shopping to bill payments. This will further strengthen the financial inclusion of all segments of the population, including those who have so far relied almost exclusively on cash.

HNB’s approach to implementing the digital euro balances innovation and the preservation of traditional values, emphasizing that cash remains a secure and accessible choice for all citizens, especially in times of crisis such as power outages or cyberattacks.

Ultimately, the digital euro expands possibilities, does not intend to restrict them, and ensures that Europe remains at the forefront of global trends in financial technology, always caring for the security, accessibility, and privacy of its citizens.