The European Central Bank could inject cash into the banking system if the introduction of a digital euro were to cause an outflow of deposits, ECB board member Fabio Panetta said on Monday.

Ahead of the ECB’s decision about developing a digital euro in October, European banking lobbies have warned that a central bank-backed currency could take deposits and business away from commercial lenders.

Seeking to dispel such fears, Panetta said the ECB could “compensate” banks if citizens ditch them in favour of the new currency, which is currently under study and will not be launched before 2026 at the earliest.

“There is one institution which is the central bank that can regulate the liquidity in the system to compensate any outflow of liquidity from the banks into central bank liabilities,” he told European lawmakers while presenting a progress report.

The ECB is working on a digital euro to prepare for a future where cash is out of favour and the private sector competes with central banks for the control of money.

It said on Monday the euro’s digital version would be only available to consumers and subject to a maximum holding limit, which has yet to be determined but has been said to be around 3,000 euro.

Companies and governments will be free to accept digital euros but not to hoard them. Euro area citizens who live outside the bloc might also have access this new form of cash if they have an account with a euro area-based payment provider, such as a bank or wallet operator.

Panetta added the ECB envisaged a take-up of 1.5 trillion euros ($1.65 trillion), which “would not impact the functioning of monetary policy”.

Consumers in others countries could gain access in further releases and people may one day be able to exchange their digital euros for foreign currencies if other central banks launch their own digital money, the ECB said in the report.

The digital euro will be distributed via apps developed by the private sector or, for the most basic features, by the central banks of the 20 countries that share the euro.

A study carried out by Kantar for the ECB found that consumers valued advanced tools that allowed them to manage their digital-euro budget, transfer cash to their peers and make offline payments.

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