Payments & Digital Money
A transfer that arrives in ten seconds, a payment that crosses a border, and money that lives on a ledger. Fifteen answers on instant payments, clearing, Wero, the digital euro, stablecoins and tokenized deposits.
The ECB in Frankfurt is preparing the digital euro, and the Bundesbank, also in Frankfurt, connects German banks to the Eurosystem payment services T2 and TIPS.
-
What are instant payments?
Instant payments are credit transfers that reach the payee's account within ten seconds, at any hour. What Regulation (EU) 2024/886 requires and by when. -
How do cross-border payments work?
A cross-border payment moves money between banks in two countries, mostly through correspondent banks and Swift. How it works and what the G20 targets say. -
Clearing vs settlement: how do they differ?
Clearing fixes what each party owes; settlement moves the money or securities and ends the obligation. How T2 and T2S settle payments and securities in euro. -
What is a clearing house?
A clearing house is the entity through which banks and brokers exchange and net transfer instructions. As a CCP it becomes buyer to every seller, under EMIR. -
What is Wero?
Wero is the wallet of the European Payments Initiative for instant payments between bank accounts. How it works, where it runs, and the digital euro. -
What is the digital euro?
The digital euro is a planned digital form of central bank money for the euro area. The ECB project phases, the Commission proposal and the status in 2026. -
What is a CBDC?
A CBDC is digital money issued by a central bank, for everyone (retail) or for banks only (wholesale). BIS and ECB definitions, the digital euro and Helvetia. -
Stablecoin vs CBDC: what is the difference?
A stablecoin is a private crypto-asset with a promised fixed value; a CBDC is money of the central bank. Issuer, claim, law and interest compared under MiCA. -
What are stablecoins?
A stablecoin is a crypto-asset that promises a fixed value in a currency. EU law calls it an e-money token or an asset-referenced token under MiCA. -
What are stablecoins backed by?
Stablecoins are backed by reserves of bank deposits, Treasury bills and repos. MiCA sets a 30 percent deposit minimum and rules for custody, audit and interest. -
What are stablecoins used for?
Stablecoins are used for cross-border payments between companies and the settlement of tokenized assets, but their largest use is trading crypto-assets. -
What are stablecoin issuers?
A stablecoin issuer creates the tokens and owes redemption to holders. In the EU only banks and e-money institutions may issue e-money tokens under MiCA. -
What are tokenized deposits?
A tokenized deposit is a bank deposit recorded on a distributed ledger. It stays a deposit under EU law, with deposit protection of EUR 100,000 per depositor. -
Tokenized deposits vs stablecoins: what is the difference?
A tokenized deposit is a bank deposit on a ledger with deposit protection; a stablecoin is a bearer token backed by a reserve. How the two differ under EU law. -
What is tokenization in payments?
Tokenization in payments replaces the card number (PAN) with a token that is useless outside its permitted use. How EMV payment tokens and PCI DSS rules work.
Where to start
Digital money comes from three kinds of issuer: the central bank with the digital euro, commercial banks with tokenized deposits, and private companies with stablecoins. The answer on stablecoin reserves shows what stands behind a token, the one on tokenized deposits what protects a bank customer.