The post ECB empowers fintechs with direct access to Europe’s central bank payment systems appeared on BitcoinEthereumNews.com.

The European Central Bank (ECB) has introduced a regulatory framework allowing non-bank payment service providers (NB-PSPs) to access Eurosystem central bank payment systems. This move marks a shift in the region’s payments ecosystem. It enables payment institutions and e-money firms like stablecoin issuers to connect directly to key infrastructures such as SEPA and TIPS without relying on traditional banks. According to the regulation: “The eligibility of NB-PSPs to access Eurosystem central bank operated payment systems is aimed at increasing the efficiency and smooth functioning of the retail payments sector, including, but not limited to, facilitating the provision of instant payments across the euro area.” The framework provides fintech firms and crypto-related businesses in the EU with a payment infrastructure that could reduce operational costs and improve transaction efficiency. While this move signals progress in integrating digital finance into the traditional banking system, the ECB remains cautious about crypto as these institutions cannot use central bank accounts to safeguard client funds. ECB stated: “Eurosystem central banks shall not offer or provide safeguarding accounts to NB-PSPs or to cryptoasset service providers.” Instead, they must establish separate arrangements to protect customer assets, as central banks will not provide safeguarding accounts for NB-PSPs and crypto service providers. Notably, the ECB has recently taken a firm stance against Bitcoin, even warning that it may reassess relationships with any European central bank holding it as a treasury asset. Still, the latest decision represents a step toward modernizing Europe’s payment landscape. What does this mean for crypto? Patrick Hansen, a senior executive at Circle, noted that this change could significantly reduce counterparty risks while cutting settlement costs. According to him, the regulation aims to lower transaction costs, improve settlement speed, and enhance competition within the EU’s financial sector by reducing dependence on banking intermediaries. It would foster…

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Filed under: News - @ February 11, 2025 2:18 pm