According to Fabia Panetta, the ECB Board member, when it comes to the use of the digital version of the euro currency, it is going to be free to use and shall be available to all, however, the bank does not intend to keep any personal data on its users.
The ECB is currently working on the digital version of the currency and is on its way to outlining the broader design, while at the same time looking to alleviate concerns that the digital currency may go on to disrupt the financial system and also give the central bank more than it wanted in terms of data pertaining to citizens.
Much like cash, digital currency is also a direct claim on the balance sheet of the central bank and thereby deemed safer than a deposit at a commercial bank. As per what Panetta told the economic and monetary affairs committee, the digital euro is going to be a public good, and therefore it will always make sense for its services to be provided without any charge, for instance when using it to pay any other person, much like cash.
Banks have a bone of contention that the digital currency may make their services obsolete, thereby it will lead to them being abandoned by customers and move their cash to the central where there is going to be more safety.
That said, Panetta opines that the ECB is not going to offer any accounts to citizens and would not allow people to make regular payments in order to cover transactions pertaining to bills, rents, etc. as it is not in the business of competing with commercial banks. They believe intermediaries who are supervised and are in direct touch with the users will be best placed to ascertain the use of any conditional or advanced payment services.
If issued, the ECB could go on to create its own standalone app for payments, or for that matter, allow commercial banks to incorporate the digital euro on their platforms.
The ECB’s own application is going to have only the basic functionalities related to payments and make sure that it is used across the euro boundaries, which have a population of almost 350 million.
Panetta added that the ECB has no intentions of setting any limitations on where, whom, or when people can go ahead with the digital euro. In the hope to address a key challenge concerning privacy and confidentiality he confirmed that ECB does not have any intent to access any personal data of the customers.
This is however going to be problematic given the fact that there are cases of money-laundering, Terror financing as well as tax evasion and hence legislators are paying heed to options that can keep regulations on its use.
It is well to be noted that the ECB is still investigating the creation of the digital euro, and its issuance seems to be years away.
