According to Financial Times News, the European Central Bank’s plan to launch a digital euro by 2029 is facing strong opposition from 14 major banks including Deutsche Bank, BNP Paribas and ING ahead of Wednesday’s parliamentary hearing. The banks warned the digital currency could undermine private payment systems and argued it offers “no clear added value for consumers” while they’ve launched their own rival service called Wero to compete with US payment companies. Conservative MEP Fernando Navarrete is pushing for a significantly scaled-down version that would only work offline, not for online payments as the ECB envisions. The ECB’s governing council recently decided to take steps toward issuing the first digital euros during 2029 with a pilot planned for 2027, but the project needs approval from EU governments and parliament since current laws only authorize physical cash issuance.
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Banking Industry Pushback
Here’s the thing: European banks aren’t just complaining – they’re actively building alternatives. Wero, their joint venture launched last year, represents a direct attempt to create what they argue the market actually needs: private sector competition to Visa and Mastercard. And they’re making some compelling points about duplication. Why should taxpayers fund a €30 billion project (their estimate, though the ECB says it’s closer to €6 billion) that essentially replicates what private companies could provide?
The German Banking Industry Committee called current plans “too complex” and “too expensive” while warning of “little tangible benefit for consumers.” That’s pretty direct criticism from one of Europe’s most influential banking lobbies. Basically, they’re asking whether this is solving a real problem or just creating a government-backed competitor to their own initiatives.
Political Divisions
Now, it’s not like everyone in Brussels agrees with the banks. Fernando Navarrete’s scaled-back vision faces opposition from social democrats, liberals and greens who all support the digital euro – even some members of his own conservative group. But his argument about creating “a parallel payments ecosystem” that could hinder private solutions is gaining traction.
What’s interesting is how he positions this as a fallback option. He told the FT that the private sector is “closer than ever before” to creating competitive payment systems, and policymakers should maximize those odds while keeping the digital euro as Plan B. That’s actually a pretty pragmatic approach – let private industry try first, and have the government solution ready if they fail.
The Bigger Picture
Look, this isn’t just about payments infrastructure. There are serious geopolitical considerations here. The ECB’s Piero Cipollone framed this as protecting “our freedom, autonomy and security” given the dominance of US payment providers and the rapid development of US-backed stablecoins. Cash usage in stores dropped from 72% to 52% in just five years – that’s a massive shift that creates real vulnerability.
And there’s historical precedent for concern. As one central bank official noted, “Visa Europe used to be European but was eventually sold.” Even if European banks successfully create their own payment network today, ownership could change tomorrow. The ECB seems to be thinking about permanent sovereignty rather than temporary solutions.
What’s Next
So where does this leave us? The Eurozone’s 20 finance ministers have already backed the ECB’s plans and are urging quick legislative action. But with banking industry resistance and parliamentary divisions, the path forward looks complicated. The official assessment document shows just how deep the concerns run.
Ultimately, this might come down to timing and scope. Can European banks prove their private solutions can scale quickly enough to satisfy sovereignty concerns? Or will the perceived threat from US payment giants and stablecoins push lawmakers toward the digital euro as insurance? Either way, 2029 suddenly feels much closer than it did yesterday.
