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The ECB and the Eurosystem begin experimental prototyping of a digital euro customer interface

The development of the digital euro will continue as the European Central Bank (ECB) and the Eurosystem have started looking for companies to participate in an exercise to prototype customer-centric payment services. Payment service providers, banks and other relevant companies were invited to express interest in the project in an announcement published on Thursday.

The Eurosystem, which consists of the ECB and the national central banks of countries using the euro, said it will select up to five front-end providers based on their capabilities and the use cases they present. While participants are not required to have prior experience with the service they are prototyping, experience will be considered in the selection process.

The prototype providers are expected to develop front-end applications according to the specifications of the system’s existing back-end and interface. They are free to provide feedback on the existing system, including how it can meet their technical needs, and are welcome to suggest additional value-added services. The participants are not paid for their efforts, but can be involved in further steps of the digital euro development.

The application deadline for the project is May 20, 2022. The project will start in August and is expected to end in the first quarter of next year. The investigation phase of the digital euro experiments will end in October 2023, by which time a decision by the Governing Council of the Eurosystem on the development of a real world is expected digital currency of the Euro Central Bank (CBDC).

Related: More than three-quarters of central banks are considering CBDC: Research

This is the latest in a long line of moves towards a digital euro that have proved controversial at times. Earlier this month, the European Commission received feedback from more than 11,000 people on its digital euro initiative, with members of the public raising concerns about surveillance and government encroachment. Nonetheless, ECB Executive Board member Fabio Panetta recently expressed the opinion that issuing a digital euro “is likely to become a necessity”.