Right to Cash and Digital Euro: Policy Analysis from a Human Rights Perspective

This policy paper analyses the legislative proposal from the European Commission on the establishment of a digital euro and the accompanying proposal on the legal tender of euro banknotes and coins, which were both released on 6th June 2023. Our analysis will focus on the fundamental rights aspects relevant to this legislation, its effect on citizens and a particular focus will be given to the privacy implications of each proposal.

We welcome the Right to Cash proposal and see it as a necessary step to tackle severe problems for financial privacy, financial literacy and the stability of the Eurozone. We support the proposal on the establishment of a digital euro as a much needed alternative to privacy invasive private digital means of payment, but only under the following three conditions:

• Firstly, that it brings a level of privacy as close as possible to cash payments, which has to be significantly better than current digital payment systems, also with regards to user privacy towards the ECB and payment service providers.
• Secondly, that this proposal does not undermine the stability of the Eurozone, in particular that (offline) payments in digital euro are protected from double spending.
• Thirdly, that it is built as a digital public infrastructure based on Free and Open Source Software, and open, inclusive and transparent standards and development processes.

Under these premises, this paper outlines risks we identified and proposes solutions where possible.