In a document to be put before finance ministers from the 20-nation euro area later Monday, it was suggested that merchants may be legally required to accept payments made with a digital euro if it is established as legal tender.
If this is the case, then payments made with the central bank digital currency (CBDC) would be seen as discharging obligations to pay in full, and retailers would have to accept it at face value.
The Eurogroup paper inquired whether any exemptions ought to be made in order to maintain a balance between contractual freedom and necessary acceptance. This discussion will take place at a meeting of ministers today.
At a former gathering in January, it was decided that the digital euro should not be programmable. This is to ensure the fungible status of money, and to prevent the recipient from limiting how a given payment can be used.
The European Central Bank is due to make its decision on issuing a digital euro in the fall, and is currently considering which uses of the currency to prioritize. European Commission’s Mairead McGuinness said last week that an upcoming bill will put forth the legal tender status, as well as money laundering regulations and compensation for those distributing the currency.
