The European Central Bank (ECB) is reportedly close to making a call on the need for a central bank digital currency (CBDC) for the Eurozone.

In comments made by Francois Villeroy de Galhau at a virtual panel discussion hosted by the Bundesbank, and reported by Bloomberg news, the governor of the Bank of France said that the ECB’s governing council would discuss the benefits and challenges of a potential CBDC following the publication of analysis from the Eurosystem task force in the coming weeks.

The report will be followed by the launch of a public consultation into the technology.

Christine Lagarde, president of ECB, speaking at the same event, also urged the need for Europe to keep up to date with rapid changes taking place across the global payments system.

“The Eurosystem has so far not made a decision on whether to introduce a digital euro, but, like many other central banks around the world, we are exploring the benefits, risks and operational challenges of doing so,” she said.

Lagarde, who has long advocated research into the potential advantages and risks of a CBDC, said that foreign payment service providers don’t represent a risk, but that Europe should be aware of the “evolving global context” which could result from failure to keep up with fast-moving technological progress.

She added that the ECB’s deliberations will be guided by concerns over continued access to central bank money and banknotes, the risks of bank deposits being transferred to digital Euro and competition considerations surrounding a CBDC.

The comments regarding upcoming deliberations over CBDC come as Facebook continues to develop plans for a roll out of its Libra digital currency and WhatsApp payments solutions globally.

Just last week, the governor of the Bank of England called for regulation of stablecoins to help facilitate their innovation as a system of payment, stating that “as regulators it is not in our interest to stop innovation”.

This followed the Bank of International Settlements publishing a paper in August considering the rise of CBDCs and the impact of the Coronavirus crisis on their development, which itself came a month after Banque de France has announced its chosen candidates for the integration of its own CBDC for interbank settlements.

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