Today Iberpay and most of Spain’s banks shared plans to simulate digital euro payments during Proof of Concept trials this year. The 29 banks, including BBVA, Sabadell, Santander, ING and Deutsche Bank, are joined by payment services organizations Iberpay, Bizum and Redsys.
The group acknowledges that this relates to a possible issuance of a central bank digital currency (CBDC), as the Eurosystem CBDC research will only finish in October 2023. A decision on whether to issue a digital euro will only be made after that.
The Spanish banks want to test how a retail CBDC would be included in the current payment infrastructures, including banks, processors and other offerings such as the local instant payment system Bizum.
As previously reported, the European Central Bank (ECB) has shared its work priorities which include person-to-person (p2P) transfers, in-store payments and ecommerce payments. The tests will involve the banks as the intermediary and custodians of the CBDC accounts.
The full list of the participating banks is below but appears to omit Spain’s third largest bank CaixaBank. The banks are: BBVA, Banco Sabadell, Banco Santander, Abanca, Arquia, Banca March, Banca Pueyo, Banco Caminos, Banco Mediolanum, Bankinter, Caixa Guissona, Caixa Ontinyent, Caja de Ingenieros, Cajalmendralejo, Cecabank, Deutsche Bank, Eurocaja Rural, EVO Banco, Grupo Caja Rural, Grupo Cajamar, Ibercaja, ING, Kutxabank, Laboral Kutxa, N26, Openbank, Orange Bank, Targobank and Unicaja Banco.
Iberpay has already led several trials relating to tokenized payments and programmable or smart money. As part of its smart money experiments, it previously trialed a potential token-based bearer CBDC and an account-based digital currency using the Iberpay Red-i interbank blockchain network.
The results of the latest experiments will be shared in 2023.
Meanwhile, the ECB is canvassing for payment industry experts to propose use cases for programmable money for a retail digital euro.