A ‘Digital Euro’ as an approach for frictionless payment processes

Abstract

Digitalisation is changing the way we think of money and payment architectures in the 21st century. Within global competition, economic benefits for the consumers and corporates in terms of convenience and efficiency will be the benchmark for success. App-based solutions with strong brands and centralised payment platforms proliferate, while Europe has a fragmented landscape of various elements for fully digitalised payment processes. Frictionless payment processes could be facilitated by a ‘Digital Euro’ as an interface between digital (and more and more automated) payment initiation at the front-end level and real-time processing and settlement at the back end. Such an approach could provide an end-to-end cross-industry synchronisation of processes with payment automation as an integral solution. This paper discusses a special case machine-to-machine payment in the Internet-of-Thing payments at the ‘edge of networks’, as they could generate a tremendous volume of ‘localised’ transactions that require dedicated solutions compared with networks with their principal overhead.