Financial news

The digital dollar and Britcoin have been highly spoken about following the successful launch of the digital yuan. However, until now, the idea of a digital euro has not been in the spotlight as much. Following the green light from the Bank of Spain‘s Financial Sandbox though, MONEI, a Spanish paytech, is going to launch its own digital euro: EURM.

This project is part of the Bank of Spain’s Controlled Testing Space. Instant payments have become the new normal by enabling fast and flexible digital money flow. However, some of the biggest challenges they have faced are national borders and attachment to archaic technical financial systems. EURM facilitates Europe-wide sending of euros and online payments by creating a token using Ethereum and Polygon blockchain technology.

In the test phase, the (individual) user simply enters their phone number and verifies their identity through video identification. It then loads their wallet with real euros via Bizum, the leading provider of instant payment services in Spain.

“EURM is the ultimate pan-European solution that will allow citizens and businesses across the continent to send and receive money instantly” – Álex Saiz Verdaguer

Automatically, the same amount of EURM is created as the number of real euros deposited by the user. They can then send EURM to the other registered users. Users will be individuals and will be able to issue EUR 10 per participant.

Thus, the potential number of EURM users in Spain is almost 57 million users as the total number of mobile phone lines in the country. Each token will represent one physical euro, the total of which will be held in two safekeeping accounts at leading Spanish financial institutions such as BBVA and Caixabank.

EURMs can be exchanged for euros at any time. In addition, there will always be the same number of EURMs as euros backing them. Álex Saiz Verdaguer, CEO and founder of MONEI, has highlighted the potential of this project stating that “the future of payments is digital. This is our opportunity to show the rest of Europe and the world that we are at the forefront. EURM is the ultimate pan-European solution that will allow citizens and businesses across the continent to send and receive money instantly”.

Practical uses of the digital euro

This project takes payments and money transfers to a new level. They’re fully digitised, more secure, more programmable and at a much lower cost than today. These innovations will have a huge impact on all businesses and their management of money collection and payments.

Among the various uses of the digital euro, once it is approved by the Bank of Spain, the following stand out:

• Sending hundreds of euros to fractions of cents at various time intervals, even milliseconds. For example, to pay for employees´ transport or food allowances.
• Allowing a business to digitise and schedule daily payments to its suppliers according to consumption that day.
• Prorate a monthly payment into daily payments to meet a cost that cannot be paid at that time.
• Allow employees to choose whether they want to receive a daily, weekly, fortnightly or monthly payroll. Without increasing the company’s workload.

All these practical uses can be programmed without the need for human intervention and are valid for both domestic and international transactions, with no higher cost per transaction. Similarly, the digital euro offers greater transparency, allowing the authorities and the tax office to consult these movements in real-time.