Bank of Cyprus and JCC join ECB digital euro pilot phase

CBC welcomes Cyprus role in ECB digital euro pilotThe Central Bank of Cyprus (CBC) on Tuesday welcomed the selection of the Bank of Cyprus and JCC Payment Systems to participate in the European Central Bank’s (ECB) pilot phase for the digital euro, marking Cyprus’ involvement in the next stage of the Eurosystem’s preparations for a potential digital currency. The Bank of Cyprus Public Company Limited and JCC Payment Systems Ltd are among 36 payment service providers chosen from across the euro area to take part in the pilot. The CBC said it welcomed the participation of the two Cyprus-based payment service providers and would work closely with them and the ECB in preparation for the pilot exercise. The pilot forms part of the Eurosystem’s ongoing preparatory work for the possible issuance of a digital euro and is expected to begin in the second half of 2027 and run for 12 months. During the pilot, selected payment service providers from across the euro area will work alongside the ECB and national central banks to test a beta version of the digital euro in a controlled environment. The exercise is intended to assess the digital euro’s technical functionality, operational arrangements and user experience, while helping to refine its overall design before any decision on issuance. The ECB explained that the beta version used during the pilot will be functionally and technically close to the digital euro envisaged under the proposed legislation, although it will not have legal tender status. The pilot follows a call for expressions of interest launched in March 2026, which attracted more than 50 applications from payment service providers across the euro area, reflecting what the ECB described as strong market interest in the project. Applicants were assessed against a set of pre-defined eligibility criteria, with the successful participants representing a broad range of business models and company sizes to ensure a diverse and representative testing environment. “The strong market interest in the pilot shows the private sector’s readiness to engage actively and quickly advance with the digital euro project to strengthen the European payments landscape,” said ECB Executive Board member Piero Cipollone, who chairs the High-Level Task Force on a digital euro. “We look forward to deeper engagement as we work with and learn alongside European payment service providers in developing a secure, efficient and inclusive digital euro,” Cipollone added. The ECB said some of the selected institutions will act as distributing payment service providers, giving ECB and Eurosystem staff access to beta digital euro services, including opening beta digital euro accounts and making payments. Other participants will act as acquiring payment service providers, enabling selected merchants to accept beta digital euro payments, while some organisations will perform both roles. The pilot will take place at the ECB and 19 national central banks, including the Central Bank of Cyprus, as well as those in Belgium, Germany, Estonia, Ireland, Greece, Spain, France, Croatia, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, Austria, Portugal, Slovenia, Slovakia and Finland. The ECB added that payment service providers may offer pilot services in countries other than those where they are established. Testing will involve staff from the ECB and participating national central banks, together with e-commerce businesses and merchants providing everyday services, such as cafeterias and restaurants. Participants will be able to make person-to-person payments, both online and offline, as well as person-to-business transactions at physical points of sale, including Software Point of Sale systems, and through e-commerce platforms, including mobile payments. According to the ECB, the pilot will also provide valuable feedback to further refine the digital euro’s design and improve the overall user experience. The central bank said regular updates on the pilot’s progress will be published through the ECB’s dedicated digital euro webpage. The ECB added that the selected payment service providers will now begin working with their respective national central banks and the ECB to complete the necessary preparations ahead of the pilot’s launch in 2027.