Although citizens in the EU already have various cashless payment options, such as credit cards, smartphones, smartwatches, PayPal or the payment app Bizum in Spain, the EU is still planning to introduce the digital euro. According to the ECB’s website, the digital euro should be usable throughout the euro area and be “as secure and user-friendly as cash is today“. Unlike commercial banks, which can fail, the citizen would be entitled to the central bank as a safe intermediary. However, amounts of up to EUR 100,000 per customer and bank are already protected by the statutory deposit insurance. This means that the central bank would only be a safer place for their money for customers with assets of more than EUR 100,000.
In order not to destabilize the banking system, Fabio Panetta, a member of the ECB Executive Board, proposes an upper limit for the digital central bank euro in an interview with the Financial Times. One possibility would be that each citizen can hold a maximum of 3,000 euros in CBDC money, any money in excess of this would have to be transferred to a bank account. Another possibility would be that you can hold as much CBDC money as you want, but above a certain threshold you become financially disadvantaged. Credits of more than 3,000 euros could then be made unattractive by penalty interest. The reasons for the introduction of the digital euro are also stated on the ECB website.