The digital euro: opportunities and challenges for consumers - financial expert provides insight

The digital euro: opportunities and challenges for consumers - financial expert provides insight

According to a report by www.vzbv.de, the European Commission presented a legislative proposal to introduce the digital euro on June 28, 2023. The Federal Association of Consumer Organizations (vzbv) welcomes this initiative, but is committed to improvements in terms of data protection, supervision and participation.

The digital euro offers the opportunity to solve the problem of a lack of digital means of payment with the core properties of anonymity, reliability, accessibility and independence. Currently, consumers often rely on private means of payment if they cannot pay with cash. This leads to dependence on a few non-European actors, low data protection standards and high costs. A digital euro, in contrast, would give all consumers access to digital payment transactions and ensure a high level of privacy without being subject to the primacy of making a profit.

The introduction of the digital euro is intended to complement cash and compete with existing digital payment methods. These are often characterized by the aforementioned dependency, low data protection standards and high costs. The vzbv therefore also welcomes the European Commission's proposed regulation to strengthen cash.

The effects of the introduction of the digital euro can be diverse. On the one hand, consumers are given access to a secure and free digital payment method. This could have a positive impact on the market by squeezing competitors with higher costs and lower data protection. The digital euro could also reduce dependence on non-European actors and thus strengthen European sovereignty.

However, other aspects such as data protection, supervision and participation still need to be improved. If the digital euro has inadequate data protection standards or does not sufficiently take consumer democratic participation into account, the potential benefits of the digital euro could be limited.

Overall, however, the digital euro offers the opportunity to make digital payment transactions safer, more cost-effective and more transparent for consumers. This can have a positive impact on the market and benefit consumers.

Source: According to a report by www.vzbv.de