The European Central Bank selected providers for five digital euro components and related services in October 2025. The ECB signed a framework agreement with the global security technology company, Giesecke+Devrient, together with its partners Nexi and Capgemini, to deliver an offline solution.
OMFIF spoke with Wolfram Seidemann, chief executive officer of currency technology at Giesecke+Devrient, about why digital cash must also work offline, technical aspects to consider and its use cases.
OMFIF: From the beginning, you’ve emphasised the necessity for a central bank digital currency to operate offline. Why is this crucial?
Wolfram Seidemann: There is a need for public money, ensuring trust and stability in the financial system through both physical and digital cash. While G+D has evolved into a security technology provider, we originated in the cash business, giving us a profound understanding of the requirements central banks have to fulfil their mandate.
Considering the reasons behind cash’s enduring success, its user-friendliness and accessibility stand out. Cash doesn’t rely on technological infrastructure, bank accounts or digital payments systems, making it especially appealing for financial inclusion purposes. With today’s digital innovations reshaping how we pay and making transactions quicker and more convenient, we started building a digital portfolio for public money transferring the advantages of cash to the digital world.
As we explored the essentials for a CBDC, it became clear to us that a retail CBDC must be a digital equivalent of cash. In the digital realm, there is currently no universal payment method that is comparable to cash and can be used in any situation, even without an internet connection. Our CBDC solutions are designed to uphold key values like trust, stability and inclusion. They bring a range of benefits, from providing access to digital financial services for people without a bank account, to enabling offline transactions. The offline functionality is one of its most important advantages over private sector means of payment.
OMFIF: Enhancing financial inclusion is the principal incentive for emerging economies to investigate the potential of CBDCs. Are CBDCs the game-changer for unbanked or underbanked people?
WS: A CBDC that operates both online and offline and is accessible via simple mobile phones or smart cards, could bridge the gaps in current digital payments systems. This would enable universal access to digital cash and financial services, allowing transactions anytime and anywhere. Factors such as age, economic status or social standing often limit access to digital payments services. A public currency must be universally accessible and inclusive, ensuring it doesn’t exclude any individuals.
Offline capabilities would expand digital payments’ access to regions with limited or unreliable networks and power supply. In addition, CBDCs could provide individuals and small enterprises with access to the formal financial system and the economy. With the user’s consent, financial institutions could migrate underbanked into more financial services and thereby enable access to microloans, for example.
OMFIF: Connectivity in developed countries is quite good compared to other regions and most people have a bank account. A study by BEUC, the European Consumer Organisation, entitled ‘What consumers expect from the digital euro’, found only 16% said that offline access was important to them. Why does the ECB place importance on the digital euro working offline?
WS: The same study found that over half of the respondents emphasised the need for the digital euro to be secure and reliable. I can’t speak for the ECB, but in my opinion, offline functionality isn’t just a nice-to-have for a CBDC; it’s essential for ensuring both reliability and resilience.
All current digital payments systems depend on stable connectivity. As public money, digital cash must be usable under all circumstances. Past events have shown us that relying solely on online systems can leave us vulnerable, highlighting the importance of having a robust, offline-capable option.
The development of a CBDC with offline functionality undoubtedly contributes to a resilient digital payments infrastructure. Furthermore, the ability to make offline payments meets the highest standards of data protection and security, which can boost trust in the digital currency. This makes it independent of device type and device manufacturer, a security and sovereignty aspect that should not be underestimated. Not least in the event of disruptions, disasters or cyberattacks, this system-inherent resilience through offline functionality is a serious advantage. Therefore, integrating offline functionalities is vital to ensure that public digital currency remains reliable and universally accessible, even in the face of unexpected disruptions.
OMFIF: Many individuals may struggle to comprehend how a digital payment can be executed without a network connection. What exactly does an offline payment entail?
WS: In simple words, it’s the ability for a person to pay another person digitally without the use of a third party or internet connection. On closer inspection, however, differences in the definition of offline become apparent.
The Bank for International Settlements has defined three types of offline: staged offline, intermittently offline and fully offline. ‘Fully offline’ is cash, where transactions are settled instantly and do not require any digital infrastructure. ‘Staged offline’ means a payment can be initiated, but it isn’t truly settled until the system reconnects online – the transaction is essentially pending. For CBDCs, we refer to ‘intermittently offline’. It allows users to make payments offline, and the money can be used immediately by the recipient.
Although reconciliation may happen later when connectivity is restored, the payment itself is settled. This is similar to how physical banknotes circulate – they are accepted and used instantly, but eventually return to the central bank for verification and security checks. It becomes particularly attractive if the receiving party can consecutively re-spend the amount received immediately.
We successfully tested an intermittently offline and re-spendable approach with our G+D Filia technology in several pilot projects, for example in Ghana and Thailand.
OMFIF: Security is a concern for many, particularly regarding offline transactions. What are the specific security measures implemented to safeguard against risks such as double-spending in offline payment environments?
WS: A CBDC must be at least as secure and robust as the payments systems we know today. A suitable implementation therefore separates the operational, transaction-related and administrative processes from each other in such a way that they cannot influence each other. This is based on a three-tier security architecture optimised for the specific requirements of a digital currency.
The basis of this security concept is a small chip at the hardware level, such as the end device on which digital cash is stored and similar to the unreadable secure element already found in SIM cards, passports, ID cards and credit cards. The next layer of security is implemented at the transaction level, where all payment data is encrypted end-to-end, similar to secure instant messengers. The third level consists of security features such as public key authentication, a kind of digital watermark that can only be created by the central banks as issuers of the digital currency. This architecture is flanked by a combination of internal security measures, external security audits and penetration tests.
OMFIF: A number of jurisdictions have quite successful central bank-backed instant payments platforms, typically involving commercial banks and existing payment services providers, rather than CBDCs. What’s your opinion on this?
WS: Instant payments are just one feature of a CBDC. Commercial banks and PSPs are crucial not only in IPS but they also serve as the customer-facing entities in a CBDC ecosystem. The central bank provides the foundational platform, enabling the private sector to issue wallets and develop innovative services.
From the insights gathered in previous BIS surveys, it is evident that many central banks recognise the value in maintaining both IPS and CBDCs as they cater to different needs and are not mutually exclusive. It’s important to differentiate between money and payments systems. CBDCs represent money in digital form, which inherently carries the ability to execute and finalise transactions.
Unlike IPS, where participation requires one to have a bank account, CBDCs can be offered more broadly, providing direct access to central bank money in a digital form. Moreover, CBDCs offer a higher level of privacy and can support diverse applications beyond peer-to-peer, including programmable payments and offline payments.
OMFIF: Given the emergence of CBDCs and the increasing prevalence of tokenised money, how do you envision the future of the financial system?
WS: The financial system is transitioning to a tokenised monetary framework, complementing the established account-based financial infrastructure. Both, public and private forms of money and infrastructures are being represented as digital tokens. This shift involves more than technological changes; it is also about reshaping the interplay of public and private money, like tokenised deposits and stablecoins, to maintain trust, efficiency and innovation. In this tokenised future financial ecosystem, interoperability is key, as well as a regulation ensuring the singleness of money. Wholesale CBDCs will be the ultimate settlement layer in this system.
Progressing with a holistic CBDC approach for both retail and wholesale will uphold the pivotal role of public money, acting as the anchor of trust and fostering an efficient, inclusive and resilient financial system.
Wolfram Seidemann is Chief Executive Officer of currency technology at Giesecke+Devrient.
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