Recent revelations from a European Central Bank (ECB) study indicate a lukewarm reception towards the concept of a central bank digital currency (CBDC), or digital euro, among European consumers. This poses potential obstacles for the ECB as it considers the introduction of the digital euro.
An ECB working paper titled “Consumer attitudes towards a central bank digital currency” surveyed approximately 19,000 individuals across 11 euro-zone nations. The study underscored the formidable communication hurdles discouraging European households from embracing the digital euro.
In a hypothetical scenario where they were asked to distribute 10,000 euros (approximately $10,800) across various assets, Europeans allocated merely a small fraction to the digital euro, leaving traditional liquid assets like cash, current accounts, and savings accounts relatively unaffected.
The ECB working paper dated March 12 concluded that Europeans strongly favor existing payment methods and perceive no substantial advantage in a new payment system given the plethora of offline and online alternatives. The paper read:
“This finding also suggests that convincing some users of the value added of a CBDC might pose a challenge for policymakers, and more research will certainly be needed in this area.”
The research suggested that despite minimal disruption to financial stability, the digital euro’s adoption faces significant barriers due to ingrained consumer habits. The paper emphasized the crucial role of tailored communication strategies in overcoming persistent consumer resistance to a digital euro.
Interestingly, the ECB paper discovered that European consumers responded positively to video-based education. It concluded that leveraging CBDC-related video content could facilitate the wide-scale acceptance of the digital euro.
The study’s release coincides with growing opposition to CBDCs among US lawmakers. Speaking at the House Financial Services Committee hearing on March 11, Representative Tom Emmer expressed a need to prioritize “pro-stablecoin legislation alongside anti-CBDC legislation.” He went on to label CBDC technology as “inherently un-American.”
Meanwhile, Deutsche Börse CEO Stephan Leithner has called for the establishment of a permanent digital euro, among other financial reforms, to enhance the region’s financial autonomy.
