FILE PHOTO: Flags in front of the European Central Bank (ECB) before a news conference at the ECB headquarters in Frankfurt, Germany, April 27, 2017. REUTERS/Kai Pfaffenbach/File Photo
FRANKFURT (Reuters) -The European Central Bank hopes to have all the political decisions in place by early next year to issue a digital euro and would then need two to three years to launch the currency, ECB board member Piero Cipollone said on Thursday.
The ECB has been working on a digital version of the euro for years but progress has been slower than expected, mostly because legislation is still not in place to allow the bank to proceed.
Financial upheaval in the aftermath of Donald Trump's election as the U.S. President has increased the urgency, however, as Europe relies on big U.S. firms for most digital payments, a potential financial vulnerability.
"I hope to have everything done by the beginning of next year, very early next year," Cipollone told a conference when asked about the timing of the legal framework. "We need the legislation in place, and from that, two to three years will be enough to launch the digital euro."
Unlike when they make a card payment by the likes of Visa or Mastercard, consumers paying with a digital would have a direct claim on the central bank and their funds would be similar in function and security as cash.
It would allow customers to make direct payments both in online and offline formats.
Cipollone said a key hurdle is getting a political agreement from EU member states but that could be reached before the summer. Work by the European Parliament could take somewhat longer, he added.
When asked if Trump could accelerate the process, French central bank chief Francois Villeroy de Galhau, speaking at the same event, said it enhanced the ECB's determination.
(Reporting by Balazs KoranyiEditing by Tomasz Janowski)
