If the development of a digital euro offers new opportunities for Europe, they can only be seized if civil society can take part in this discussion, argue Tristan Dissaux, Jézabel Couppey-Soubeyran and Wojtek Kalinowski in a column signed by more 100 scholarship holders and NGOs.
Tristan Dissaux is a researcher at the Free University of Brussels. Jézabel Couppey-Soubeyran is associate professor at Paris 1 Panthéon-Sorbonne and at the Paris School of Economics. Wojtek Kalinowski is co-director of the Veblen Institute for Economic Reforms.
As the euro celebrates its 20th anniversary, the European Central Bank (ECB) is exploring the possibility of creating a “digital euro” in addition to the coins and notes that we still use, but less and less, in our daily transactions.
Unlike bank cards and other payment systems, the digital euro would be a “central bank digital currency”, i.e. a currency issued and guaranteed directly by the ECB, accessible and usable by everyone.
As such, it offers new opportunities for our societies and for the Euro itself, challenged by many private digital currency projects. But is the ECB ready to seize these opportunities?
Access to central bank money in digital form is currently restricted to banking and financial players; a digital euro would make it available to all individuals and economic actors. A digital euro could make our payment systems more inclusive and less expensive for the poorest sections of the population.
It could also be used to implement new economic, social or environmental policies by allowing monetary transfers to all European citizens. Finally, it could strengthen the legitimacy of the single currency by putting it more clearly at the service of European citizens.
However, there are reasons to fear a missed opportunity. The ECB seems to consider the new digital currency as a purely technical tool disconnected from any social or political consideration, and preparations are advancing without any real involvement of citizens, in a top-down and technocratic way.
Although the ECB has announced its intention to collaborate with all players in society, it has so far only set up a group of 30 experts (the Digital Euro Market Advisory Group) exclusively from the banking and financial sectors. These experts are indeed in a privileged position to shape the concrete form of the digital euro.
As for the Euro Retail Payments Board, which includes two consumer associations among its 20 members, it is only invited to give its opinion on specific results to be submitted by the ECB. Citizens will only be involved through a few focus groups, the details of which are unknown.
The public consultation already organized by the ECB and closed in January 2021 cannot justify not involving European citizens more widely.
The democratic issues involved deserve much more than an online questionnaire that receives little media coverage, is not very accessible and does not allow us to understand the subject, when most people do not know the whole question.
We therefore call on the ECB to genuinely involve society in the ongoing investigation into the digital euro and to widen the discussion to the objectives that could be pursued with the help of this monetary innovation.
This first requires transparency on the activities and reflections carried out within the ECB on the future digital euro, as well as on the possibility given to civil society and academic actors to participate.
Secondly, we call on the ECB to initiate a real public debate on the digital euro, informed and informed, within the Member States.
Above all, we need our democracy to get involved. The subject is not only technical, it is above all political because the digital euro concerns us all.
We therefore call on the European Parliament to address this issue in the framework of its monetary dialogue with the ECB. This dialogue is the main framework established by the Treaties where our democracy can express itself on the objectives of monetary policy.
It should thus include the objectives of the digital euro, without being reduced to a pure formality where the Parliament is content to take note of the decisions already taken.
The future digital euro must be considered as a public good. Its preparation phase offers a unique opportunity to involve citizens, their representatives and civil society actors in a broader discussion on how the digital euro could help euro area countries better cope with multiple crises they face.
These options will strongly depend on the chosen technical design, which should therefore not be pre-empted by financial and banking players.