Cash Remains Preferred Choice of Bundesbank
### Title: Bundesbank Board Member Addresses Digital Euro and ATM Cooperation in Germany
In an interview with news portal "t-online", Burkhard Balz, board member of the German Federal Bank (Bundesbank), discussed the cooperation among banks regarding ATM networks and the development of the digital euro.
Despite not providing direct quotes, the current status and future plans relevant to Balz's role can be summarized based on the latest information about Germany's and the EU's digital euro initiatives.
### Current Status of ATM Cooperation and Digital Euro in Germany
The European Union is actively progressing with the digital euro project, with the official preparation phase starting in November 2023. The aim is to enhance Europe’s strategic autonomy in digital payments and offer a sovereign digital currency alternative to predominant non-European providers.
A comprehensive technical and regulatory guideline, known as the "Rulebook", is scheduled for release in October 2025. This rulebook will define how the digital euro can be used for in-store, online, and peer-to-peer payments with features such as QR codes, link payments, offline usability, and discussions over account limits for individuals and the role of banks in distribution.
The project is complex and budgeted at approximately 1.2 billion euros for external contracts, excluding infrastructure costs. Germany has a broad digital roadmap with significant funding to boost digital technologies, including digital public services and infrastructure, which would underpin the adoption of innovations like the digital euro.
However, resistance remains from some member states, including Germany, concerning fiscal risk-sharing related to the EU's broader monetary initiatives, which indirectly impacts digital euro acceptance and implementation.
### Future Plans and Outlook
The decision to launch the digital euro will be made by the European Central Bank’s Governing Council after EU legislation is finalized, targeting an earliest introduction around 2027.
Balz's role as Bundesbank board member implies advocacy for smooth integration of the digital euro into existing financial infrastructures, including ATM networks, ensuring interoperability and broad accessibility. The digital euro aims to reduce reliance on fragmented national payment systems and foreign providers by unifying payment infrastructure across the eurozone, including Germany.
Balz also emphasized the importance of cash, stating that it remains valuable in crisis times, such as power outages or cyberattacks, due to its independence and inability to be hacked. He supports a certain cash regulation, including a Europe-wide cash transaction limit of 10,000 Euros from 2027.
Balz called for more cooperation, such as operating ATMs jointly, as a solution to the decreasing number of ATMs and bank branches in Germany. In some regions, it might become more difficult to access cash in the future.
Cash transactions at checkout counters are still expected to be more than 50 percent in 2023, according to earlier information. Balz did not express any concerns about cash becoming obsolete in the future, citing the desire for anonymity, security, and control as reasons for high cash affinity in Germany.
The Netherlands have a model where banks operate their ATMs jointly via a central society, but Balz did not provide any new information about this model in the interview.
In conclusion, Germany, under the guidance of Bundesbank representatives like Burkhard Balz, is actively engaged in the digital euro initiative aligned with broader EU goals. The project is advancing through the preparation of comprehensive regulations and infrastructure development, with the digital euro expected to complement and gradually integrate with traditional banking services such as ATM networks. However, political and legislative challenges persist, requiring careful coordination among EU member states, including Germany.
Finance and technology will play a significant role in the integration of the digital euro into Germany's existing financial infrastructure, as Bundesbank board member Burkhard Balz emphasizes the importance of ensuring smooth cooperation among banks, particularly in regard to ATM networks. The future plans also focus on leveraging technology to create infrastructures that are interoperable and accessible for broad use, aiming to merge the digital euro with traditional business practices such as ATM services.
