paneuropean payment initiatives have shown that ensuring broad access throughout the euro area has ultimately always required regulatory measures. so, both sides of the coin – widespread acceptance and broad access – are necessary to ensuring the digital euro would be a public good that meets the expectations of consumers and merchants. these two aspects are also key to achieve other public policy goals. for instance, they are essential to ensure that the digital euro can support financial inclusion and generate opportunities for financial intermediaries. a digital euro would offer a new platform for innovation that is truly european. it would allow these intermediaries to build services for their customers that are instantly available across europe. it could help domestic payment providers and new instant payment solutions to scale up and operate at the european level. and it would reduce dependence on a few dominant providers, increasing competition and resilience. ensuring a seamless european payment experience over the past 20 years euro banknotes have enabled everyone in the euro area to easily recognise and use public money, regardless of what country they are living in, or where they are paying. the same should be true for the digital euro. people should be able to pay and be paid in digital euro anywhere in the euro area, no matter which intermediary they are using to access the digital euro or which country they are in. to achieve this, we need a common set of standards – which we call a “ payment scheme ”. the scope of these standards will be limited to what is strictly necessary to establish and offer users a harmonised and convenient payment experience, while enabling and inviting the supervised intermediaries to develop further services and solutions. even if supervised intermediaries will distribute the digital euro, one should not forget that it will be a liability of the central bank. the eurosystem, as its issuer, would be accountable to euro area citizens for its correspondence to their payment needs. the eurosystem should therefore be able to govern the standards to ensure that using a digital euro in the future is as standardised as using cash today. it would do so by steering consensus among all involved stakeholders – consumers, retailers, banks and nonbanks. ensuring wide availability through the right economic incentives economic incentives should be used to encourage the active distribution of the digital euro and to ensure that it is widely available. we have already proposed a set of four core principles for a digital euro compensation model. you asked for more details on these principles in previous hearings, so i will share our thoughts on them

diagnosis that led to our credit easing package identified a dysfunctional bank lending channel as a prime threat to achieving our ultimate objective of price stability. our measures were tailor - made to that objective and offer a powerful response to address the root cause of the impaired bank lending, and thus to facilitate new credit flows to the economy. is it working? tentative evidence suggests yes : our credit easing package is indeed delivering some tangible first benefits. broad measures of nominal financial conditions have eased and spreads on senior abs and covered bonds have fallen. consistent with our expectations, price adjustments have been particularly pronounced in those segments where we intervened directly. the case of the abs market stands out : spreads fell by an impressive 70bps since may although our purchases only started a few weeks ago. by way of comparison : the fed ’ s qe - 1 announcements, which involved combined purchases of nearly $ 2tn of mbs, treasuries and gses, are estimated to have lowered 30 - year mbs yields by some 100bps. at the same time, the broad - based nature of the easing across markets suggests that the signalling effect – operating through a flattening of the ois curve – has also been a powerful element of our response. lending rates have fallen too. since may the composite indicator of the nominal cost of bank borrowing for euro area nfcs fell by 40bps to 2. 6 % in october. in italy this indicator fell by nearly 60bps. in other words, the premium italian firms pay for bank borrowing relative to the average euro area firm has fallen in recent months – a sign that the transmission of our policy is gaining traction. lending volumes seem to be responding too. evidence is growing that a turning point in loan dynamics might have been reached. as a result, the downward pressure on the output gap stemming from impaired credit supply is levelling off. at the same time, banks also report an increase in loan demand, which means that our measures come at the right time : banks would not borrow under tltro unless demand for loans strengthens. a binding policy response but flexibility aside, have we also adhered to the other element of our strategy i mentioned last year : have our measures been binding enough? here we need to be more cautious in our assessment. the fact is that – despite our broad - based measures and the associated fall in private borrowing costs – inflation has not stopped trending down. in november inflation in the euro area fell back to a cyclic