FAQs on the digital euro pilot

Updated on 15 April 2026

Pilot overview

Roles and responsibilities

Participation and application process

Preparation and development

Pilot payment services

Technical aspects

Pilot overview

Q1 What is the digital euro pilot?

The digital euro pilot is a limited practical exercise to help the Eurosystem learn how a digital euro could work in everyday situations. The pilot will help the Eurosystem assess its technical, operational and user readiness for a potential digital euro by validating the infrastructure in real-life conditions and gathering evidence to inform future decisions.

It will give the Eurosystem hands-on insights by enabling a limited group of individual end users (Eurosystem staff) and business end users (e.g. merchants) to make and receive payments using a beta version of the digital euro. For example, an ECB staff member could send money to a colleague, pay at the ECB canteen using their phone, or buy an item online, while the Eurosystem monitors the process and collects feedback. This will support an assessment of the system’s robustness, scalability and usability, and strengthen cooperation between payment service providers (PSPs), merchants and central banks.

The pilot will also help the Eurosystem to refine the digital euro design and user experience and to assess communication and branding approaches. Updates will be communicated transparently, reflecting the Eurosystem’s commitment to building trust by preparing responsibly for the potential introduction of a digital euro, should a decision to issue be taken in the future.

Q2 Does the digital euro pilot mean that the ECB has decided to issue a digital euro?

No. Preparing for the digital euro pilot does not pre-empt any decision to issue the digital euro. The ECB will only take a decision on whether to issue the digital euro once the EU co-legislators adopt the Regulation on the establishment of the digital euro (digital euro Regulation).

In the current phase of the digital euro project, the Eurosystem is continuing to prepare for the potential introduction of a digital euro, following a flexible approach to ensure alignment with the legislative process. The pilot will ensure that the Eurosystem is technically and operationally ready to act efficiently and effectively when the legislative process concludes.

Q3 How would a beta digital euro differ from the digital euro?

The pilot will use a digital means of payment referred to as the “beta digital euro” that is different from the digital euro foreseen in the legislation.

The beta digital euro will be a digital means of payment issued by the Eurosystem central banks upon receipt of funds from pilot PSPs, leading to the creation of Eurosystem liabilities vis-à-vis third parties. It will be a liability (representation of value in the books of the Eurosystem) subject to the rules for cashless payment transfers applicable to PSPs, individual end users and business end users. As regards the online beta digital euro exclusively, it will be considered as “scriptural money”, falling under the current definition of “funds”, under the revised Payment Services Directive (including relevant level 2 legal acts). It will not be a banknote and/or a coin, and it will not constitute an account held directly with the ECB or any other Eurosystem central bank.

Participants would hold or open a commercial bank money account with participating payment service providers (pilot PSPs) for the duration of the pilot.

Q4 What is the timeline for the digital euro pilot?

The envisaged timeline for the digital euro pilot consists of the following three phases.

1. Pilot preparation phase (first half of 2026): the call for expression of interest was published on 5 March 2026. PSPs must submit their applications by 14 May 2026. Additional relevant documentation will be provided to PSPs during the application window, including user journeys, end-to-end flows, functional requirements and the PSP participation agreement. The ECB and participating national central banks (NCBs) will evaluate PSP applications and notify applicants of the selection outcome by the end of June 2026.
2. Pilot development phase (starting in the third quarter of 2026): after signing the PSP participation agreement, pilot PSPs will start preparing for their participation in the pilot. This entails the development of pilot payment services, digital euro service platform (DESP) onboarding and integration, user testing and back-end certification, and the onboarding of end users.
3. Pilot operational phase (starting in second half of 2027, 12-month duration): once the pilot becomes operational, pilot PSPs will provide pilot payment services in close cooperation with the ECB and their national central bank (NCB) counterpart. Their tasks will include onboarding end users, processing operational transactions for specific use cases and facilitating the collection of feedback from end users for assessment by the ECB.

Throughout all phases of the pilot, the ECB and participating NCBs will actively engage with pilot PSPs to collect feedback, clarify requirements and ensure adequate support.

Q5 What is the geographical scope of the digital euro pilot?

The pilot will take place on-site at the ECB and at participating NCBs across the euro area. All interested PSPs are encouraged to apply to participate in the pilot. The Eurosystem welcomes a broad geographical distribution of participants. Pilot PSPs must sign a PSP participation agreement with the NCB of a country where their headquarters or a legally established subsidiary is located.
There are two possible ways to do this.

• A parent company PSP (which owns or controls subsidiary companies) may sign the agreement with the participating NCB in the country where it is established and subsequently provide services to pilot end users across the euro area under the passporting regime (which allows PSPs authorised in the euro area to operate across all euro area countries).
• Each subsidiary PSP may sign a PSP participation agreement with the respective participating NCB in the country where the subsidiary is established and will operate during the pilot.

Provided pilot PSPs are authorised to operate in that country, this set-up enables cross-border participation, allows pilot PSPs to provide pilot payment services to individual end users (Eurosystem staff) in locations other than at the site of NCB with which they have signed the participation agreement.

Q6 What payment use cases will the digital euro pilot cover?

The pilot will validate four use cases:

• Online P2P transactions using a user alias^[1] or DEAN^[2]: a payer transfers funds to a payee (both are individual end users), initiating the transaction by entering the unique identifier of the payee in the payment application. The transaction typically takes place remotely and can be completed when the payer and payee are not in physical proximity. The transaction is completed when the payer’s device is connected to the internet. Therefore, it is classified as an online payment.
• Offline P2P transactions via NFC: a payer transfers funds to a payee (both are individual end users), initiating the transaction by entering the amount in the payment application on the payer’s device without the need for either device to be connected to the internet. The transaction is completed in a proximity set-up via NFC by tapping the two devices together. Since the transaction is settled instantly between the participating devices and does not require an internet connection, it is classified as an offline payment. For additional details see Q47 – Q51.
• Online P2B transactions at the point of sale via NFC: a payer (individual end user) transfers funds via their payment application to a payee merchant (business end user) as payment for goods or services at the point of sale. The payee is equipped to accept payments via a SoftPOS^[3] application on their device. The transaction is initiated when the amount is entered in the SoftPOS application, either automatically by the cashier system or manually by the payee. The transaction is completed by tapping the devices of the payer and the payee together, allowing the transaction details to be exchanged between the devices via NFC. Since both devices must be connected to the internet for the transaction to be completed, it is classified as an online payment.
• Online P2B transactions in e-commerce or m-commerce using a user alias or DEAN: a payer (individual end user) transfers funds to a payee (business end user) as payment for goods or services on an e-commerce or m-commerce platform. The transaction is initiated when the payer selects the beta digital euro as the payment method on the payee’s mobile website or payment application. If available, the default payment application opens via overlay (seamless embedded app-to-app redirect). If no default payment application has been defined, the payer inserts their unique identifier (alias or DEAN) in the payment gateway provided by the payee and is prompted to open their payment application. In both cases, the payer verifies the payee and payment details and then confirms, authenticates and authorises the transaction. The payer receives confirmation of the payment in their payment application and on the payee’s mobile website or payment application. The transaction is completed via the internet. Therefore, it is classified as an online payment.

Roles and responsibilities

Q7 What is the role of pilot PSPs in the digital euro pilot?

As key partners of the Eurosystem during the pilot, pilot PSPs will enable pilot payment services for end users and support the collection of feedback. The pilot distinguishes between two PSP roles: distributing and acquiring. Each pilot PSP will fulfil one or both of these roles.

• Distributing PSPs will enable individual end users to use pilot payment services – such as access, liquidity and transaction management – through the Eurosystem-provided digital euro app or via integration in the PSP’s proprietary app.
• Acquiring PSPs will enable business end users (merchants) to use pilot payment services, including access, liquidity and transaction management and payment acceptance functionalities. For example, they may be asked to offer a SoftPOS solution and/or an e-commerce/m-commerce solution to enable the acceptance of beta digital euro by merchants.

The Eurosystem provides the digital euro service platform (DESP)^[4] and enables pilot PSPs to connect to it during the pilot, ensuring end-to-end product testing and validation of the value proposition. Pilot PSPs will gain first-hand experience of the beta digital euro ecosystem and provide feedback that will help to further shape its technical specifications.

Q8 What are the roles of the ECB and euro area NCBs in the digital euro pilot?

The ECB is coordinating the digital euro pilot at the Eurosystem level, with euro area NCBs acting as the main operational counterparts for pilot PSPs at the national level.

During the pilot, participating NCBs will, with support from the ECB:

• provide pilot PSPs with the documentation (e.g. technical specifications, user journeys) necessary to develop and release pilot payment services for the use cases covered in the pilot;
• facilitate liquidity operations related to the digital euro pilot on behalf of their pilot PSPs;
• collect feedback from pilot PSPs and support their collection of feedback from end users.

Q9 Who is eligible to participate in the digital euro pilot as an individual end user or a business end user (merchant)?

The individual end users in the digital euro pilot will be members of staff from participating Eurosystem central banks. To be eligible to take part, they must be or become a customer of a pilot PSP.

Merchants (both in-store and e-commerce/m-commerce) are eligible to participate in the digital euro pilot if they have both:

• a contractual relationship with the ECB or a participating NCB for the duration of the pilot;
• a contractual relationship with a pilot PSP for acquiring services.

Q10 If an end-user opens an account with a PSP specifically for the pilot, do they need to be offboarded after the pilot?

No. End users will not have to be offboarded from the pilot PSP once the pilot concludes. They need to be offboarded (e.g. closing of the beta digital euro account) from the pilot once the pilot phase is concluded. For end users who already had an account with the pilot PSP before the digital euro pilot, the existing relationship will continue. For end users who opened an account specifically for the pilot whether the account remains open or is closed after the pilot is at the discretion of the end user and the pilot PSP in question, in line with their contractual arrangements. After the pilot ends, any ongoing relationship between the end user and the PSP would relate only to the PSP’s (non-pilot) services.

Participation and application process

Q11 Why should PSPs participate in the digital euro pilot?

Participation in the pilot offers PSPs an opportunity to actively contribute to shaping the future of payments in Europe, and to engage directly with the Eurosystem’s operational and technical teams.

The pilot provides first-hand experience with the beta digital euro, which can support PSPs’ preparation for a potential roll-out of the digital euro and enable them to develop value-added services as first-movers.

Pilot PSPs will gain early operational experience with the envisaged set-up for providers of digital euro services, including onboarding, settlement, liquidity management, incident handling and refunds, and will be able to identify practical implications for their systems, processes and resourcing.

Participation also provides a structured channel to share evidence-based feedback on how the digital euro infrastructure and prioritised use cases perform in real-life conditions, helping inform potential improvements. In addition, pilot PSPs will be well placed to suggest ways to optimise implementation choices (e.g. integration approach, use of existing components and partners, internal vs. external development), which can help manage costs, compliance and capacity needs.

The pilot has already attracted interest from a range of PSPs, many of which joined the focus sessions in January and March, underlining the market relevance of the project.

Q12 How many use cases must a PSP support to participate in the pilot, and can PSPs apply for multiple roles with support from technical service providers?

The overall scope of the pilot covers four prioritised payment use cases (see Q6). Pilot PSPs are expected to support the use cases relevant to the role they apply to:

• Distributing PSPs are expected to support both P2P use cases and the distribution activities (i.e. enabling individual end users to use pilot payment services) of the P2B use cases.
• Acquiring PSPs are expected to support both of the P2B use cases.
• PSPs applying for both the distributing and the acquiring PSP roles are expected to cover all relevant use cases within the scope of the pilot.

A PSP may rely on technical service providers (TSPs) (see Q13) for certain functions (e.g. acquiring services). In that case, the PSP remains the formal applicant and, if selected, the formal pilot participant. The application should cover all the services the PSP intends to provide in the pilot.

Q13 What is considered to be a technical service provider (TSP) in the context of the digital euro pilot, and which types of entities may act as TSPs?

In the context of the digital euro pilot, a technical service provider refers to a third-party entity that supports a participating PSP in developing, integrating, operating or providing pilot payment services. TSPs may provide a wide range of technical or operational services, depending on the PSP’s delivery model. These can include technical integration with the PSP’s systems, wallet and front-end solutions; merchant acceptance and POS infrastructure; payment processing services; as well as optimisation of cross-border and offline payment functionalities. TSPs may include payment processors, IT service providers, software vendors, system integrators, or consultancies supporting implementation and integration activities.

Q14 Will there be a separate selection process or dedicated call for technical service providers (TSPs)?

No. There is no separate selection process or dedicated call for TSPs. Participation in the pilot is limited to PSPs, which remain the sole applicants and the sole entities evaluated and contracted (see Q19). PSPs may rely on TSPs as part of their delivery model (see Q12 and Q13), but this does not affect the evaluation or selection process. Where PSPs outsource or rely on third parties, they can indicate this in the relevant sections of the questionnaire (e.g. under Miscellaneous, M.1). This information is collected for information purposes only and is not assessed as part of the evaluation. The PSP remains fully responsible for meeting all requirements and obligations under the pilot.

Q15 How can PSPs apply to participate in the digital euro pilot? 

To apply, PSPs are required to complete a questionnaire (published as Annex 2 to the call for expression of interest) and submit it to the Eurosystem together with any evidence needed to support their application. The call and the related documentation are published on the digital euro pilot web page.

The application window opened with the launch of the call for expression of interest on 5 March 2026. Applications must be submitted to digitaleuro-pilot@ecb.europa.eu by 17:00 CEST on Thursday, 14 May 2026.

Q16 Are there specific eligibility requirements for pilot PSPs? How will PSP applications be assessed?

Yes. The Eurosystem will assess all applications based on two defined sets of selection criteria: eligibility requirements and weighted evaluation criteria. These are set out in Annex 2 to the call for expression of interest.

The eligibility requirements ensure that only PSPs with the necessary regulatory license and technical and operational capabilities are eligible to proceed to the weighted evaluation stage. PSPs that do not meet all the eligibility requirements will not be considered for selection.

The weighted evaluation criteria assess eligible PSPs based on factors that are relevant to achieving the objectives of the pilot, in order to ensure that the pilot has comprehensive coverage (for example, in terms of geographical footprint, use cases and end users). PSPs are not required to meet all the weighted evaluation criteria to be considered for selection.

Q17 Can PSPs operating outside of the euro area participate in the digital euro pilot?

Yes, PSPs operating outside the euro area are eligible to take part in the digital euro pilot, provided they are authorised to operate in the euro area. Specifically, PSPs must hold a valid EU licence to provide payment services under the revised Payment Services Directive (PSD2) as a credit, electronic money or payment institution, in accordance with applicable regulatory frameworks.

Pilot PSPs must sign a PSP participation agreement with the NCB of a country where their headquarters or a legally established subsidiary is located (see Q5).

Q18 How should PSPs operating in multiple countries apply for the pilot?

PSPs should submit one application indicating all the countries where they are licensed (see Q5) and wish to offer pilot services. This is explained in Annex 2 – questionnaire, under weighted evaluation criteria W.2, which covers PSP presence in the participating euro area countries.

Q19 Can PSPs submit joint applications or apply as a joint venture?

No. Joint applications and joint ventures are not permitted. Organisations wishing to participate in the digital euro pilot together should instead designate one PSP as the official applicant. This PSP would submit the application and, if successful, act as the formal participant in the pilot. The other organisation(s) would act as technical service providers (TSPs), PSPs should indicate the services which are outsourced or supported by third parties in the relevant sections of the application questionnaire (e.g. under Miscellaneous, M.1).

For example, if a distributing PSP relies on a third party to provide specific services, such as infrastructure services or a front-end solution, the distributing should submit the application covering the services it intends to provide in the pilot, including those delivered with support from that third party, even if under their existing contractual arrangement, the third party would be considered a technical service provider (TSP) for the purposes of the pilot. This also includes cases where a distributing PSP relies on a third-party front-end solution (e.g. an external wallet or payment app) to provide certain user-facing functionalities (see Q12 and Q13)

Q20 How are consortium arrangements (e.g. those involving TSPs) considered in the evaluation process, given that selection is based on individual PSPs?

The evaluation and selection process is based exclusively on individual PSP applications, which are assessed against the eligibility requirements and weighted evaluation criteria set out in the call for expression of interest. PSPs are expected to present the full scope of services they intend to provide in the pilot, including cases where certain functions (e.g. acquiring services) are supported or delivered with the involvement of TSPs (see Q13). This allows the Eurosystem to assess the PSP’s end‑to‑end capability to deliver pilot payment services. Consortium or joint applications are not permitted (see Q19). Where services are outsourced or supported by third parties, PSPs should indicate this in the relevant sections of the questionnaire (e.g. under Miscellaneous, M.1). These details are used for information purposes only and are not assessed separately; the PSP remains the sole entity evaluated and is fully responsible for meeting all requirements.

Q21 Can PSPs participate in the digital euro pilot via a direct contract with the ECB?

No. Pilot PSPs must sign the PSP participation agreement with a participating euro area NCB (typically the NCB of a country where they are established or operate under passporting). Once selected, and after signing the agreement, a PSP may provide pilot payment services on-site at the ECB (e.g. by ECB staff and participating merchants) as part of the overall pilot set-up.

Q22 How many PSPs will be selected for the pilot?

It is currently expected that about 10 to 30 PSPs will be selected to participate in the pilot, covering the whole euro area. The final number of pilot PSPs will depend on several factors, including the number of eligible applications received, the roles applied for, the prioritised use case and the geographical footprint. This is to facilitate a mix of pilot PSPs ensuring the set pilot objectives are met (validate readiness before scaling, improve digital euro value proposition, improve go-to-market strategy and prepare for subsequent market rollout).

Q23 Can PSPs amend their application after submission or join the pilot after the deadline?

PSPs can amend their submitted application up until the deadline of 17:00 CEST on Thursday, 14 May 2026 and submit it to digitaleuro-pilot@ecb.europa.eu. No further changes or new applications will be accepted after this deadline. To participate in the pilot, PSPs must follow the application procedure set out in the call for expression of interest and apply within the designated application window.

Q24 When indicating the number of individual end users, should PSPs refer to their total customer base or only those expected to participate in the pilot?

When indicating the number of individual end users in the application, PSPs should refer to their total customer base. This provides a complete view of a PSP’s overall scale and market presence.

Q25 How should PSPs report resource estimates in their application? Should the indicated effort include contributions from technical service providers (TSPs), or only internal resources?

PSPs should provide resource estimates that reflect the overall effort required to support their participation in the pilot, including activities related to development, integration, testing and operations. PSPs should provide estimates for their internal resources in Annex 2 – questionnaire. Where relevant, a PSP may take into account contributions from TSPs, particularly where these are part of the PSP’s delivery model (see Q13).

Q26 What are the requirements for submitting supporting documentation as part of the application? How can they be submitted?

PSPs are required to complete and submit the application questionnaire provided as part of the call for expression of interest (Annex 2 – questionnaire). PSPs should use the “Explanation” column to provide supporting information, while respecting the character limit. PSPs are not expected to submit additional supporting documentation as part of the application. Applications must be submitted to digitaleuro-pilot@ecb.europa.eu by 17:00 CEST on Thursday, 14 May 2026

Q27 What does a “direct or indirect connection to TARGET Services” mean in the application questionnaire?

“Direct or indirect connection to TARGET Services” refers to whether a PSP has direct access to TARGET accounts or has such access via another institution, in line with the TARGET Guideline.

Direct connection means that the PSP holds its own TARGET accounts (e.g. a main cash account or a dedicated cash account). Indirect connection refers to arrangements where the PSP accesses TARGET Services through another participant.

Preparation and development

Q28 What will PSPs need to develop when participating in the digital euro pilot?

Pilot PSPs will develop pilot payment services for the priority use cases during the digital euro pilot. They will receive detailed documentation on several aspects of the envisaged set-ups for these use cases, including connectivity setup, requirements for front-end implementation, common services and back-end infrastructure. While pilot PSPs are expected to develop pilot payment services independently, they will be able to contact the Eurosystem for technical clarifications and support. To ensure efficient development, pilot PSPs should decide on their implementation approach and plan delivery accordingly and are invited to cooperate with subcontractors such as TSPs (see Q13).

Q29 To what extent can pilot PSPs reuse investments made in the context of the digital euro pilot (e.g. infrastructure, integration, compliance)?

As the Eurosystem is following a flexible and modular approach in its continued preparation for a digital euro, in line with the legislative process, it is envisaged that pilot PSPs and all other stakeholders, including the Eurosystem, will be able to build upon the investments made during the pilot when implementing digital euro services, should a decision to issue the digital euro be taken.

The extent to which pilot PSPs can reuse their investments will, however, depend on their individual implementation strategy and other factors, such as the final content of the digital euro Regulation.

Q30 What are the expected workload and costs for pilot PSPs? 

The workload and costs of participating in the digital euro pilot will be different for every pilot PSP and will depend on their individual business model, existing infrastructure and internal cost structures. Key cost drivers may differ according to the level of integration required, the balance between internal and external development and the scope of the PSP’s participation in the pilot. The workload required may vary based on aspects such as the extent of system modularity, prior experience with comparable initiatives, and the scope of pilot activities chosen by the pilot PSP. Additionally, pilot PSPs are invited to cooperate with subcontractors such as TSPs to support their development efforts, as well as to leverage existing technical solutions. Pilot PSPs will bear their own costs related to their participation in the pilot and no subsidy is foreseen.

Q31 Will participating PSPs be remunerated?

No. Pilot PSPs will not receive any remuneration or incentives of any kind (financial or non-financial) from the Eurosystem for their participation in the pilot, and their expenses will not be reimbursed. The same applies to business end users and individual end users.

Q32 Can PSPs outsource pilot activities to third parties such as technical service providers (TSPs)?

Yes. PSPs may outsource certain pilot activities to third parties, including TSPs, to support their development, integration or operational efforts (see Q13). Outsourcing may give pilot PSPs more organisational flexibility and provide a means to leverage specialised expertise or implement specific functionalities more quickly, through existing technical solutions and partnerships.

In line with the EBA Guidelines on outsourcing arrangements, the PSP remains fully responsible for fulfilling its role and obligations under the pilot (see Q33).

The ECB recognises the important role played by TSPs in the retail payments ecosystem and is engaging with them directly through dedicated workshops to facilitate their critical role during and after the pilot and to ensure market readiness.

Q33 Do third parties (e.g. TSPs) engaged by a PSP have any direct contractual or compliance obligations towards the ECB/Eurosystem, or does the PSP remain solely responsible?

Third parties, such as TSPs, do not have a direct contractual relationship with the ECB or the Eurosystem in the context of the pilot. The PSP remains the formal participant in the pilot, enters into the participation agreement with the relevant participating euro area NCB, and is fully responsible for complying with all applicable requirements (see Q19). Any arrangements with third parties are managed by the PSP, which remains fully responsible for ensuring that all obligations under the pilot are met, in line with the EBA Guidelines on outsourcing arrangements.

Q34 Will authorised TSPs be allowed to send and receive data from the digital euro service platform (DESP) on behalf of pilot PSPs?

Yes, as PSPs may rely on TSPs to support the delivery of their services, TSPs will be allowed to send and receive pseudonymised data from the DESP on behalf of pilot PSPs. This may include payment-related data (e.g. for initiating a payment, confirming execution or receiving status updates) or account-related queries (e.g. for retrieving balance or transaction history information). However, the pilot PSP remains fully responsible for all interactions with the DESP and for complying with the pilot requirements.

Q35 What is the scope of user testing and how will it be organised?

User testing will ensure that pilot PSPs achieve technical and operational readiness by the start of the pilot. It will focus on validating the onboarding process, the scope of the four prioritised use cases and the operational procedures.

A dedicated digital euro service platform (DESP) user testing environment will be made available to pilot PSPs. This environment will support all pilot payment services and functional requirements, with the scope expanding progressively as additional functionalities are introduced during the user‑testing period.

User testing will allow pilot participants to validate their integration with the DESP and to confirm that the functional requirements and end-to-end process flows can be executed as intended. The scope is therefore directly aligned with the functional requirements and the end-to-end flows that PSPs are expected to support throughout the pilot.

Pilot PSPs will receive a comprehensive testing plan covering onboarding, development activities, and user testing requirements. It will follow an iterative approach, with functionalities and use cases being progressively introduced and validated, allowing pilot PSPs and the Eurosystem to gradually test, refine and stabilise services before the start of the pilot.

User testing begins several months before the start of the pilot to allow PSPs to complete all onboarding and development activities, align internal processes to the functional requirements of the pilot, and identify and resolve issues. This will ensure a unified end-user experience and that the pilot can be executed in a stable and reliable manner.

Q36 Will PSPs receive operational support during the pilot?

Yes. The ECB and participating NCBs will provide operational support to pilot PSPs during the pilot development phase and operational phase of the pilot, including with liquidity management. Additionally, all pilot PSPs will be connected to the overarching pilot exercise, together with all other participating NCBs and the ECB. More detailed information (including on onboarding, testing and training) will be shared with pilot PSPs after the selection process.

Pilot payment services

Q37 What is the difference between alias and digital euro access number, and will a unique alias type be used across all PSPs during the pilot?

The digital euro access number (DEAN) is the unique identifier assigned to a beta digital euro payment account, which uniquely identifies the end user account within the PSP domain. It is created and assigned via the pilot PSP in interaction with the DESP when an end user is onboarded.

An alias is an alternative identifier that can be optionally linked to the DEAN and used as an additional means to access the beta digital euro account. It can be something familiar and easy to remember, like a phone number.

Q38 Will aliases be managed by the Eurosystem alias lookup service during the pilot?

The digital euro pilot foresees the use of an alias lookup service to support the registration/ deregistration of aliases (e.g. phone numbers) and their mapping to the corresponding DEAN. This will enable the user’s account to be identified seamlessly during transactions.

Q39 Can an end user hold more than one beta digital euro payment account during the pilot?

No. Multiple accounts per end user are not in the scope of the pilot. Each end user will hold one beta digital euro payment account, identified by a unique DEAN.

Q40 Will there be holding limits in the digital euro pilot?

Yes, holding limits will apply during the digital euro pilot, as per digital euro design. The specific limits to be applied to the beta digital euro will be communicated closer to the launch of the pilot.

Q41 waterfall and reverse waterfall functionalities be available in the digital euro pilot?

Yes, both functionalities will be in the scope of the digital euro pilot:

• Funding of online beta digital euro holdings from a linked commercial bank money account, the end-user has with the pilot PSP, when the transaction amount exceeds the available holdings (waterfall), and
• Defunding to a linked commercial bank money account when predefined holding limits are exceeded (reverse waterfall).

Q42 Do PSPs need to connect with external banks to support waterfall and reverse waterfall functionalities and can end users configure thresholds for these functionalities?

No, as the pilot does not intend to test the open funding functionality, PSPs do not need to establish separate connectivity with other PSPs specifically for waterfall and reverse waterfall functionalities. These functionalities are implemented as part of the pilot PSP’s integration with the DESP (see Q44). They rely on a commercial bank money account linked to the end user’s beta digital euro payment account (both accounts need to be with the same pilot PSP), while the processing of funding and defunding beta digital euro is handled via the DESP dedicated cash account.

End users cannot configure custom thresholds for waterfall or reverse waterfall funding. Users may enable or disable these functionalities, but they are triggered on the basis of predefined system conditions (e.g. insufficient balance or exceeding holding limits). These conditions are defined by the system design and are not configurable by end users.

Q43 Is blocking funds on the linked commercial bank account required before funding?

No. Blocking funds on the linked commercial bank account before settlement is not a mandatory requirement in the digital euro pilot.

The implementation of such mechanisms is left to each pilot PSP, which must ensure that these comply with the overall functional and operational requirements defined for the pilot.

Q44 How will digital euro service platform dedicated cash accounts (DESP DCA) be managed during the pilot – manually or automatically?

DESP DCAs are a dedicated settlement account in central bank money that will be used by pilot PSPs to process beta digital euro transactions during the pilot.

During the digital euro pilot, liquidity management of the DESP DCA will be executed manually.

Pilot PSPs will need to fund and defund their DESP DCA through manual transfers. Automated liquidity management features, such as floor- and ceiling-based transfers, are currently not envisaged for the pilot stage.

Q45 How will the beta digital euro be treated on pilot PSPs balance sheets?

The underlying mechanisms behind the balance sheet treatment of the beta digital euro work in a similar way to those of the digital euro. However, the beta digital euro is not the same as the digital euro (see Q3). When an end user funds their beta digital euro account from their commercial bank money account, the funds move off the pilot PSP’s balance sheet and onto the Eurosystem balance sheet. Likewise, when the user defunds their beta digital euro account, the funds leave the Eurosystem balance sheet and return to the pilot PSP’s balance sheet.

Q46 Will there be a compensation model in place for the digital euro pilot?

Pilot PSPs will bear their own costs and no fees can be charged by pilot PSPs to participating end users (merchants/consumers) for the provision of pilot payment services in the context of the pilot. Additional details will be specified in the PSP Participation Agreement.

Technical aspects

Q47 How does the offline beta digital euro technically work, and how can PSPs integrate the offline functionality? 

Offline P2P transactions via NFC will be tested in the pilot. When these transactions are performed, the exchange will take place between the payer’s device and the payee’s device in proximity, without the need for either to be connected to the internet. The transaction is completed via NFC by tapping the two devices together.

The offline beta digital euro has three main components (see digital euro pilot business architecture): 

• User domain - the mobile application running on the phone and using its secure element. 
• PSP domain - the software service running on the PSP's premises acting as the distribution component.
• Eurosystem domain - the issuance component running in the backend of the Eurosystem. 

The mobile application (user domain) serves as the interface for individual end users. It can be the Eurosystem-provided digital euro app or integrated in the PSP’s proprietary app. If a pilot PSP chooses to integrate the beta digital euro into its own app, it will receive a software development kit (SDK) to streamline the integration process. For offline functionality, this mandatory SDK will handle interactions with the phone’s secure element and ensure secure communication with another phone or backend system. 

The service running on the phone’s secure element (PSP domain), which enables the secure offline use of the beta digital euro, will be provided by the ECB. This removes the need for pilot PSPs to have expertise in developing secure element application or to implement specific security measures, such as protection against double-spending. 

The distribution component serves as an intermediary between the phone and the Eurosystem backend. It functions as a bridge, relaying direct requests from the mobile application, such as funding or defunding operations. It enables the pilot PSP to incorporate business logic, such as transferring funds from a user’s commercial bank account in case of funding the offline beta digital euro. The ECB will provide a technical specification and a reference implementation to facilitate the pilot PSP’s integration of the distribution component.

The offline issuance component is responsible for funding/defunding offline beta digital euro holdings with commercial bank money or online beta digital euro. This funding/defunding service is hosted by the Eurosystem. 

Q48 What functionalities are provided by the digital euro app offline digital euro software development kit, and to what extent does it support the technical implementation?

The Eurosystem provides an SDK for both Android and iOS, to support pilot PSPs in integrating offline pilot payment services into their proprietary mobile applications.

The SDK can be embedded as a software library within a PSP’s mobile banking app. It is designed to simplify integration by providing the core functionalities required to interact with the Offline Wallet applet (secure element) and the Offline Distribution component for offline digital euro operations.

To support implementation, the SDK is delivered together with documentation, including API documentation and integration guides.

PSPs that choose to integrate pilot payment services into their own application must comply with the minimum UX requirements defined in the user journeys & minimum UX requirements document, ensuring a harmonised user experience across pilot participants.

These tools and specifications are intended to streamline integration and reduce the time and effort required during the pilot development phase.

Q49 What is a secure element and why is it needed for the offline beta digital euro? 

Secure elements are needed for the offline beta digital euro because offline transactions in the pilot are P2P transactions conducted in proximity between the payer’s device and the payee’s device via NFC, without an internet connection. In this context, the secure element is a hardware component that protects the transaction processing and the stored value on the device against tampering, extraction of sensitive data and other attacks. The processing of transactions within a secure element, such as debit or credit transactions, is protected and cannot be disrupted. Attackers are unable to extract sensitive data, such as cryptographic keys, or alter critical information, such as the balance of funds, stored within an eligible secure element. These secure elements come in various form factors, including embedded SIM (eSIM) and embedded Secure Element (eSE). 

Q50 What are the functional and operational differences between the offline beta digital euro and cash, and how are these reflected in the technical architecture and distribution model? 

The offline digital euro is meant to function like a digital equivalent of cash, offering similarities while incorporating distinct features. As it is the case when withdrawing banknotes from an ATM, users must fund their offline beta digital euro device to be able to use the offline functionality. Once the device is funded, users can make offline payments seamlessly, with or without connectivity, and benefit from immediate offline settlement in proximity. Additionally, beta digital euro received offline can be re-spent offline without needing to reconnect to the network first. However, if a user wishes to defund their device — i.e. convert their offline funds back into commercial bank money — their device connects to the pilot PSP distribution component, which in turn contacts the Eurosystem backend. 

When the pilot PSP's distribution component is contacted, the pilot PSP can update the user’s commercial bank account. The same process applies for defunding. 

The Eurosystem’s offline issuance component will then update the dedicated cash account (DCA) based on the funding or defunding operation. 

Q51 What would be the PSPs' involvement in securing offline digital euro when it is in the PSP's app? 

When an offline payment is being made, the software running on the secure element of the end user’s phone protects against double-spending. This software is provided by the ECB regardless of the choice of integration (Eurosystem digital euro app or integration in the PSP’s app), so that pilot PSPs do not need to develop the corresponding security countermeasure on their own. 

Q52 Will the Eurosystem provide a digital euro app and a software development kit for the pilot?

Yes. The Eurosystem will provide a digital euro app as well as a software development kit (SDK) to support pilot PSP with integration into proprietary applications. This will allow pilot PSPs to either use the Eurosystem-provided app or integrate pilot payment services into their own applications (see Q48).

Q53 What type of POS solution is required for the digital euro pilot, and which standards apply to it?

For proximity P2B payments in the digital euro pilot, acquiring PSPs are expected to provide a SoftPOS solution, i.e. a payment acceptance solution running on a commercial off-the-shelf mobile device (such as a smartphone or tablet) using NFC technology. The SoftPOS solution must support Contactless Payments Authentication for Card Emulation (CPACE) as the applicable standard for NFC-based payment interactions. Transaction flows for proximity payments use the CPACE standard.

However, as long as the POS solution supports CPACE, PSPs may also use different solutions (e.g. an Android-based POS solution).

Q54 Will a software point of sale (SoftPOS) development kit be provided by the Eurosystem?

The Eurosystem does not currently plan to provide PSPs with a SoftPOS development kit. The Eurosystem will provide a Software Development Kit (SDK) for the digital euro app. Each PSP is free to define and implement its own acceptance solution, taking into account the relevant commercial and technical context.

Q55 Is there a defined flow for providing a CPACE-based payment instrument in the digital euro app, and which parties are responsible for its initialisation?

The mobile app provided to individual end users needs to offer a feature that allows users to pay with NFC. Pilot PSPs are responsible for providing such a feature either by using the digital euro app or by offering it as part of their own proprietary app. In both cases, the Eurosystem will provide the necessary SDK and server-side functionalities, so that PSPs can minimise their efforts to the extent possible.

Q56 Can PSPs use existing terminal integration protocols (e.g. ZVT) to connect POS devices to their backend systems, or are they required to implement specific standards such as Nexo from the outset?

Pilot PSPs are free to use their own integration protocols for communication between the POS and the PSP backend, provided those protocols adhere to the functional requirements outlined in the implementation specifications.

Q57 What technical standards and interoperability requirements will apply to the digital euro pilot?

The digital euro pilot leverages existing open market standards wherever possible to ensure interoperability and a harmonised end user experience across pilot PSPs.

Key standards and approaches include:

• CPACE for NFC-based proximity payments:

CPACE is used for secure NFC communication between an individual end user device and a merchant SoftPOS device in online mode.

• ISO 20022 data model:

The pilot uses ISO 20022 as the basis for its data dictionary and message structure, ensuring alignment with existing payment infrastructures.

• API-based standards and data models:

Existing market standards are adapted for JSON RESTful API-based communication, including elements such as the Berlin Group’s data dictionary.

• PSP-specific solutions for merchant integration:

Communication between the business end-user (merchant) domain and the PSP backend is based on PSP-specific standards and solutions.

The standards identified for the pilot are candidate standards. Their final adoption is subject to confirmation by the Eurosystem, and the set of applicable standards may evolve over time.

These FAQs support payment service providers (PSPs) by addressing common questions and providing clarifications related to the PSP call for expression of interest to participate in the digital euro pilot.

If your question is not covered, please submit a new question.

The replies to the FAQs are non-binding and do not extend in any way the rights and obligations deriving from applicable legislation nor introduce any additional requirement than those included in the relevant contractual documentation for the pilot. The expressed views are not authoritative and cannot prejudge any future actions the ECB may take.