By David Barwick – FRANKFURT (Econostream) – European Central Bank Executive Board member Piero Cipollone said Friday that the digital euro would help preserve commercial banks’ role in the payments ecosystem while strengthening Europe’s payments sovereignty.

Cipollone, speaking at the annual meeting of Italy’s Federation of Cooperative Credit Banks (Federcasse), said the shift toward digital payments meant central bank money also needed a digital form or risked becoming marginalized.

The digital euro would be issued by the Eurosystem and distributed by banks, allowing them to retain customer relationships while providing Europe with payments infrastructure under European governance, he said.

Banks would continue to hold customer relationships, transaction records and interchange fees, while the digital euro would allow them to innovate more easily and reduce dependence on external payment platforms, Cipollone said.

Cipollone reiterated that, assuming the legislative process is completed by the end of this year, the digital euro could first be issued in 2029. He also noted that the pilot project is due to begin in September 2027 with 36 participating payment service providers.