ECB Executive Highlights Need For Digital Euro Amid Declining Cash Usage

According to PANews, European Central Bank (ECB) Executive Board Member Fabio Panetta emphasized the growing importance of digital currency as the use and acceptance of cash continue to decline. Panetta noted that while central banks have long provided digital settlement for wholesale transactions, a digital form of cash has yet to be introduced. This issue is becoming increasingly significant as the usage of physical cash diminishes. In response, the European Commission has proposed legislation to ensure the acceptance of cash, and the ECB is committed to maintaining the widespread availability and accessibility of euro cash. However, the trend of reduced cash usage in daily transactions is likely to persist, reflecting the digitalization of economic activities and patterns observed in many developed economies. Panetta stressed the urgency of addressing the risks posed by Europe's current inability to ensure the integration and autonomy of its retail payment systems. This concern is a key motivation behind the digital euro project, which aims to bring central bank money into the digital age, providing a digital currency equivalent to physical cash and strengthening monetary sovereignty.