The European Parliament’s Committee on Economic and Monetary Affairs (ECON) has taken a major step toward shaping the future of Europe’s financial ecosystem.
On 31 October 2025, ECON issued its draft report on the proposed Regulation governing the provision of digital euro services by payment service providers (PSPs) in non-euro Member States — marking a significant development in the European Union’s digital currency framework.
💶 Expanding Access Beyond the Eurozone
The proposed regulation aims to allow payment service providers in Member States whose currency is not the euro to offer digital euro services under the same supervisory and compliance standards as PSPs within the euro area.
In practice, this means banks, fintechs, and electronic money institutions operating in countries such as Denmark, Sweden, Poland, and Hungary could eventually issue or manage digital euro wallets — subject to equivalent AML/CFT obligations and oversight.
By expanding access, the EU seeks to promote interoperability, cross-border payments, and financial inclusion while maintaining the integrity of its single market.
🏦 Key Points from the ECON Draft Report
The draft report (document reference ECON_PR(2025)778135) provides several important clarifications and safeguards:
- Equal Supervision Standards
Non-euro PSPs offering digital euro services must comply with the same regulatory framework that applies to euro-area PSPs — particularly under PSD2 and the EU AML/CFT directives. - Privacy and Transparency
The digital euro must preserve a “cash-like” level of privacy for users, while ensuring traceability sufficient to meet financial crime obligations. ECON underlined that privacy cannot come at the expense of AML/CFT integrity. - Operational and Technological Oversight
The European Central Bank (ECB) and national competent authorities would share responsibility for oversight, ensuring technical resilience, data protection, and the security of transactions. - Cross-Border Stability
ECON highlighted potential risks if digital euro usage becomes dominant in non-euro states, warning of monetary sovereignty and financial-stability implications. The report calls for limits on holdings or transaction volumes if necessary. - Fees and Merchant Acceptance
The report supports a transparent fee structure and fair access for merchants — ensuring the digital euro complements, rather than competes with, existing payment systems.
🔍 Why This Matters for Compliance Professionals
For compliance teams across Europe — and especially for institutions operating in or alongside non-euro Member States — the ECON report signals a shift in how central bank digital currencies (CBDCs) will intersect with AML/CFT obligations.
Key takeaways include:
- Cross-border risk management: PSPs will need to strengthen monitoring frameworks to address the movement of digital euros across jurisdictions.
- Enhanced AML/CFT integration: The regulation confirms that digital euro transactions will fall fully within the scope of EU AML laws.
- Operational readiness: New reporting, record-keeping, and oversight expectations will require system upgrades and staff training.
- Privacy-versus-transparency balance: Compliance functions will be at the center of designing safeguards that uphold both user privacy and regulatory expectations.
As the legislative process moves forward — with amendments due by 12 December 2025 and a plenary vote expected in early 2026 — financial institutions should begin preparing for the compliance, technology, and governance implications of a pan-European digital currency framework.
📘 StudyAML Insight
The digital euro is more than a technological innovation — it’s a compliance evolution.
As regulators expand access and oversight, financial institutions will need to translate policy into practice:
embedding AML/CFT controls, revising risk assessments, and equipping teams with the knowledge to manage new payment models responsibly.
At StudyAML, we’ll continue to track the regulatory process and provide guidance to help compliance professionals stay ahead of the curve.
