What if the digital euro becomes more than just another payment method and fundamentally reshapes the payments ecosystem?
With the digital euro planned for 2029, Europe’s payments landscape could be heading for a significant transformation. For banks and payment service providers, this is about much more than new technical interfaces. It is about infrastructure, customer experience, interoperability and how different payment solutions can come together to create a seamless customer experience.
Katja Gasche of Worldline and Martin Henke of Capco both work extensively on the future of payments. In this interview, they discuss the challenges banks should already be considering, how the digital euro could interact with existing propositions such as Wero and digital wallets and why technologies such as agentic payments are adding a new dimension to the debate.
Katja Gasche, Area Head for Mobility, Retail & Growing Markets DACH & CEE at Worldline Financial Services, has worked in payments and at Worldline for more than 18 years, holding various market-facing and leadership roles. Today, she is responsible for a broad client portfolio that includes banks, network operators, acquirers, payment service providers, fintechs and larger corporates increasingly operating as financial institutions.
Martin Henke, Executive Director, Banking & Payments at Capco, has around 15 years of consulting experience in retail banking and retail payments. His work spans product innovation and transformation programs across accounts, digital wallets and card programs, as well as regulatory initiatives including instant payments.
When and how could consumers start paying with the digital euro, and what challenges does its introduction create for banks and payment service providers?
Martin Henke:
Based on current expectations, consumers could start using the digital euro in the second half of 2029. A key prerequisite is the regulatory framework, which is currently expected toward the end of 2026. From there, the current expectation is that approximately two and a half years would be needed before a Europe-wide rollout and go-live could take place.
For consumers, the digital euro is intended to enable much more than peer-to-peer payments. It could be used for payments in stores and online as well as for offline payments. The intention is also for it to be interoperable with the existing payments ecosystem.
That is where one of the major challenges emerges: banks and payment service providers will not simply be adding another payment method to an existing frontend. They will need to introduce new functionality across significant parts of their payments infrastructure.
Unlike solutions that use existing instant payment infrastructure for payment processing, the digital euro will require its own payment infrastructure. Market participants will need to establish new interfaces to the Digital Euro Service Platform and integrate digital euro processing end to end into their operations. Some functionality will also need to be developed specifically for the digital euro because its underlying logic does not fully correspond to today’s SEPA payment processes.
Banks and payment service providers will not simply be adding another payment method. The digital euro will require new functionality across the payments landscape.
What role is Worldline playing in preparing for the digital euro, and how are you preparing for its introduction?
Katja Gasche:
Worldline has been involved in shaping the digital euro since the early stages of its development. Since 2020, we have participated in consultations and working groups with the European Central Bank and national central banks, contributing our payments expertise to the development process.
We have also been involved in developing prototypes for offline payments and contributing to the rulebook. For the pilot phase, Worldline will participate as both an acquiring payment service provider and technical service provider, supporting banks and financial institutions throughout the digital euro value chain, from infrastructure connectivity and transaction processing to banking channel integration and merchant acceptance.
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One of our main priorities is reducing complexity for financial institutions. Through a standardized API connection to the Digital Euro Service Platform, the aim is to manage as much of that complexity as possible within the Worldline platform.
This is not only about integration. Time to market, reducing project risk and creating investment certainty are equally important. Our goal is to reuse existing infrastructure where appropriate and build solutions that can scale as requirements evolve and potentially support other next-generation payment methods.
Our focus is on significantly reducing complexity for financial institutions while creating infrastructure that can evolve to support future payment methods.
How can the digital euro be integrated into existing payment offerings without creating additional friction for merchants and customers?
Katja Gasche:
Standardization and reusability are critical. We have focused on standardized APIs that enable connectivity to the Digital Euro Service Platform while creating the foundation for integrating additional payment methods.
Different channels also need to be considered. Whether at the point of sale or in e-commerce, the objective should be to handle as much complexity as possible within the platform while minimizing the impact on the existing infrastructure of financial institutions and payment service providers.
Ultimately, customers should not have to experience the complexity that sits behind a new payment method.
What changes in retail payments and customer behavior should banks consider today?
Martin Henke:
Customers have become accustomed to payments that are simple, fast and secure. Mobile wallets are a good example of this evolution. Today, customers expect payments to be intuitive, seamless and reliable.
The digital euro will need to meet a comparable standard. User experience is just as important as speed and security.
At the same time, the digital euro will not simply replace existing payment methods. Cash, cards, direct debits and other methods will remain part of the payments mix. Banks therefore need to consider how the digital euro fits alongside their existing propositions and how customers can move easily between different forms of money.
Another important consideration is value-added services. Successful card propositions today can include insurance, loyalty programs and other benefits. If banks approach the digital euro purely as a regulatory compliance exercise, they may end up with a functional wallet but not necessarily a compelling customer proposition.
Customers are unlikely to expect a new payment experience to be worse than what they already have. Banks should therefore consider relevant value-added services alongside the core digital euro functionality.
Banks and payment service providers should consider how Wero, the digital euro and other propositions can be integrated into a broader digital wallet strategy.
How can banks approach the implementation of the digital euro over the next three years?
Katja Gasche:
The pilot phase will be critical for testing whether the proposed infrastructure works effectively in an operational environment. Banks and other market participants should use this period to assess technical and operational maturity and resilience, identify areas for improvement and incorporate user feedback into the customer experience.
They should also examine whether existing core banking systems need to be adapted to support digital euro requirements. Even with API-based integration, the pilot may identify additional requirements, including around settlement and downstream processes.
The next step is to understand how the digital euro ecosystem can be integrated into existing payment environments and scaled effectively. Seamless integration into mobile banking, wallets and other frontend solutions will be particularly important if the digital euro is to gain customer acceptance.
We are also looking beyond Europe at experiences with other digital currency initiatives to understand which use cases have worked and which early-stage challenges should be avoided.
Martin Henke:
Banks should also make a clear decision about their make, buy or hybrid strategy. The requirements for the digital euro are diverse. Financial institutions therefore need to determine which capabilities they want to build within their existing technology landscape and where they want to rely on solutions from core banking providers, payment service providers or other external partners.
A hybrid model is also possible. A bank might source much of the underlying functionality externally while still integrating the customer experience directly into its own banking app.
If the regulatory framework is finalized as currently expected, my recommendation would be to begin these initiatives in 2027 rather than wait until 2028. With a potential go-live in 2029, the implementation window could otherwise become very tight.
The objective should not simply be regulatory compliance. Banks need sufficient time to build a solution that also delivers a compelling customer experience.
Seamless integration into mobile banking, wallets and other frontend solutions will be particularly important if the digital euro is to gain customer acceptance.
Wero, digital wallets and the digital euro: competition or complementary propositions?
Katja Gasche:
From our perspective, they are complementary. We already operate in a market where different payment schemes coexist. The important question is what specific value each solution provides.
Wero can, for example, provide a user-friendly interface for account-to-account and real-time payments. The digital euro has a different role: legal acceptance and trust in public money in the digital environment are at its core.
Digital wallets could become the environment that brings these propositions together while also incorporating services such as loyalty and digital identity.
Looking further ahead, intelligent systems could potentially determine which payment method should be used for a particular transaction based on factors such as efficiency and security.
Martin Henke:
From the customer’s perspective, the objective should be to create a unified and simple experience.
Imagine a customer needing one standalone app for one payment method, another app for the digital euro and additional apps for other wallet services. In my view, that would be a worst-case scenario.
Banks and payment service providers should instead consider how Wero, the digital euro and other propositions can be integrated into a broader digital wallet strategy. The complexity should remain in the background rather than being passed on to the customer.
What can the digital euro learn from digital identity and agentic payments?
Katja Gasche:
Digital identity is an important foundation of trust in any payment system. Identity verification needs to be secure and ideally take place in real time in the background without unnecessarily disrupting the customer journey. That principle can also be applied to the digital euro: the process should be secure and resilient while remaining as seamless as possible for the customer.
Agentic payments add another dimension. If autonomous AI systems or connected devices initiate payments on behalf of customers, the requirements around APIs, resilience, identity and security monitoring increase further.
The interaction between secure digital identities and agents that can execute transactions will therefore become particularly important. These environments will require robust monitoring and appropriate human oversight to maintain trust in the overall system.
What could payments look like in 2029?
Martin Henke:
Banks should consider several possible scenarios.
In one scenario, today’s payment mix changes only gradually. The digital euro becomes another option alongside cards, mobile wallets, cash and other payment methods, replacing a proportion of existing transactions without fundamentally changing customer behavior.
In another scenario, adoption of the digital euro could be significantly stronger. Its position at checkout, its economics for merchants or potential public-sector initiatives could all influence how quickly it becomes a relevant payment method.
There is also a third scenario that goes beyond individual payment methods: agentic payments. By 2029, customers may increasingly delegate payments to digital agents. If that happens, the payment method used in the background could become less visible to the customer. The primary customer experience might instead be defined by the wallet or agent that initiates and manages the transaction.
That creates a strategic question for banks and payment providers: Who owns the customer interface and which payment rail is ultimately used in the background?
The digital euro should therefore not be considered in isolation. Banks need to think about its role within a payments landscape in which wallets, instant payments, digital identity and increasingly AI-enabled services could all converge.
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