Digital euro: Banks warn of up to 30 billion cost explosion!

Digital euro: Banks warn of up to 30 billion cost explosion!

Deutschland - The plans for the introduction of a digital euro cause a sensation and concerned reactions among European banks. According to a report by Kosmo , this project could be associated with billions of costs for the financial institutions. The revealing study by the management consultancy PWC estimates the costs for changes at 19 examined banks at over 2 billion euros. Extrapolated to the entire euro area, the financial burdens between 18 and 30 billion euros could be, depending on the scenario.

The investigation was carried out on behalf of three European credit associations. Euro national banks have been working on a digital version of the community currency for years, with the aim of creating a European alternative to US payment service providers such as PayPal, MasterCard and Visa. However, many banks and savings banks in Germany are skeptical about the project. They question the specific additional benefit of the digital euro compared to existing payment methods.

critical concerns of the banks

The PWC analysis identifies several essential cost factors for the introduction of the digital euro. Adaptations of mobile banking apps, web banking platforms and physical payment cards are just a few of the necessary measures. Special expenses could also result from the necessary modifications to pay terminals in retail. In addition, the ATM infrastructure would have to be converted, which could cost an average of around 9 million euros per financial institution.

PWC experts also warn of personnel bottlenecks. The implementation of the digital euro could bind almost half of the available specialists for years and thus hinder innovations in payment transactions. These concerns are all the more pressing because established systems such as real -time transfers already meet high demands on speed and security.

future of payment transactions

As part of current discussions on the digital future of payment transactions, which were organized by the Bundesbank, among other things, the digital euro is treated as a central topic. In these conversations, innovative solutions such as "Decentralized Finance" and token economy are also discussed, which have the potential to revolutionize the payment on the Internet of Things. In its last speech emphasized that 90% of the central banks have already dealt with digital central bank money and have already gained initial experience.

The digital transformation has made cashless payments considerably popular, supported by new technologies such as biometry and NFC. The future role of the digital euro remains uncertain. The targets are clear: faster, simpler and more flexible payments should meet the needs of consumers.

Nevertheless, there is skepticism compared to the digital euro, especially since many consumers already use existing payment methods. It remains to be seen whether and how the digital euro will ultimately prove itself in practice.