Embedding CBDCs into everyday payments

Every day, billions of transactions flow through global point-of-sale (POS) systems. An estimated 2.17 billion credit card payments alone were processed daily in 2024,¹ according to Capital One Shopping data. Add debit cards, mobile wallets, and cash transactions to the mix, and the figure grows to an estimated 3–4 billion daily worldwide.

The infrastructure supporting POS payments is expanding rapidly. In the eurozone in 2023, POS terminal networks grew by 13.3% to 19.9 million units, with 83% accepting contactless payments.² This reflects an overall shift in consumer behavior toward more convenient payment experiences, with shoppers increasingly favoring mobile wallets at the till.

This is exactly the environment retail CBDCs are designed for – and the opportunity is clear: to make digital public money usable in everyday life.

“Central banks have proven that CBDCs work technically, but now they need to solve the problem of driving user adoption,” says Lars Hupel, Chief Evangelist CBDC, G+D. “If CBDC wallets are to become a primary way for customers to initiate payments and for merchants to accept them, the point of sale becomes the logical starting point. If people can’t use CBDC where they actually shop and pay, they won’t use it at all.”

History demonstrates that the adoption of new payment methods follows commercial incentives at the merchant level. For example, when Chinese tourism increased in Germany, merchants rushed to introduce UnionPay as a payment option. The commercial logic was straightforward: accept UnionPay cards or miss out on sales to Chinese visitors. In this case, the business need was driven by consumer demand. For CBDC, the story will be different: how do you convince consumers to adopt this new payment method? It starts with merchant acceptance.

The business case for retail CBDCs

Let’s consider a familiar scenario: a business traveler arrives at the airport for a business trip. They grab a taxi to the hotel, and when they arrive, the traveler asks the driver if they can pay with a card because they don’t carry cash. The driver smiles politely and reaches for the card terminal. Although they happily accept the payment, they would much rather take cash. Not for nefarious tax reasons, but because the funds from the card payment (minus the obligatory fees) won’t hit their account for a couple of days. This means that the fare won’t be able to go toward to the next refuel on the way back to the airport, and they’ll have to dip into their own pocket.

This is a pain point felt by many small businesses, whose existence depends on a daily cash flow. Here’s how a CBDC could make life easier for the taxi driver, and for all merchants:

• Instant settlement: Unlike traditional card payments that take days to clear, CBDC transactions settle immediately – the funds appear in the driver’s wallet within seconds of the transaction and can be immediately used to refuel at the gas station.
• Lower fees: By reducing the reliance on international payment providers, our taxi driver loses less of their fare to transaction fees, resulting in significant cost savings throughout the year.
• No counterparty risk: A CBDC is a direct claim on the central bank, so the merchant is never exposed to the credit risk of a private processor. Essentially, the money the taxi driver receives is as reliable as the banknotes in their wallet.

That’s one of the beauties of a CBDC: it’s just like taking cash, but with the convenience of digital. And just like cash, CBDC provides another advantage over existing digital payment options: offline functionality.

Digital cash that works anywhere, anytime

Dual offline functionality enables two devices to exchange value (e.g., between customer and merchant) with immediate, cash-like finality, even when neither is connected to the internet. Unlike staged offline transactions (authorized now, settled later), CBDC moves funds from device to device at the point of sale. For our taxi driver, that means they can immediately refuel after accepting a fare, even when driving outside of coverage areas. 

For merchants, this strengthens operational resilience and protects sales – particularly in regions prone to natural disasters or limited connectivity. Naturally, consumers also benefit from this, ensuring they can buy critical supplies during blackouts or emergencies.

On a broader level, offline CBDCs support financial inclusion, removing barriers that have, until now, excluded millions from the digital economy. Not having a bank account or a stable connection will no longer be a hurdle to making digital payments. And even in mature markets, where consumers already have the luxury of choice at the POS, a CBDC has its place. Rather than replacing existing methods, it can complement them, adding a privacy-preserving, cash-like rail to the same tap/scan experience people already use.

Fortunately, the path to implementing CBDC at the POS is a lot easier and less cost-intensive than many imagine. How successfully a merchant manages the implementation will depend on a few practical considerations.

Bringing CBDC to the point of sale

The most important factor for successful adoption is making CBDC wallet payments as intuitive as any other payment method – there must be zero friction for the end user. How this looks in reality varies from region to region. For example, in card-dominant markets such as Europe, a CBDC should operate through familiar contactless interfaces – whether using a physical card or a digital wallet. In contrast, in parts of Asia where QR codes have become the predominant form of payment, a CBDC should integrate with QR payment rails. 

The same principles apply to the merchant side. The less friction, the more likely it is that they will adopt. A Bank of England point-of-sale proof-of-concept study demonstrated that CBDC payments can be accepted using existing payment terminals,³ albeit with some minor software updates – known as “kernels.” Alternatively, smartphones can also serve as acceptance devices, reducing the barrier to entry for small businesses even further.

Standards: building on proven foundations

Of course, any CBDC will need to align with industry standards to match the global interoperability that card providers such as Visa or Mastercard offer. As per the Bank of England study, CBDCs can leverage established EMV^® (Europay, Mastercard, Visa) standards to some degree and be introduced as additional program identifiers alongside existing payment rails – at least for online transactions. This facilitates merchant adoption of CBDC payments without requiring brand-new infrastructure.

However, the landscape is less straightforward for offline payments. Currently, no standardized protocols exist to support offline peer-to-peer transactions. This is largely because most central banks are developing CBDCs independently, and any implementation of an offline CBDC is highly sensitive to the design of that system.

“Offline functionality is one of CBDC’s most compelling differentiators, but the current fragmentation is holding back its potential,” says Lars Hupel. “As more central banks roll out CBDCs and gain real-world experience with offline technology, we have an opportunity to converge toward common standards that can enable greater interoperability as the ecosystem matures.” 

The path forward

After years of development and discussion, CBDCs are moving from concept to reality. The infrastructure is in place, the business case is clear, and the appetite for more-seamless transactions is stronger than ever. The POS is the natural place to embed CBDC payments, and the path to integration is much simpler than many assume.

What matters now is execution – turning the technical capability into merchant and consumer adoption, with a payment experience that delivers the cash-like resilience and digital convenience that makes CBDCs so compelling.

As a global expert in digital payments, G+D supports central banks around the world in developing CBDCs with truly offline payment solutions.

Read now

“A conceptual model for point-of-sale payment with retail central bank digital currency” by Lars Hupel, Chief Evangelist CBDC, G+D

Published: 28/10/2025