Fintech 2026

PORTUGAL Trends and Developments Contributed by: Diogo Pereira Duarte, Ricardo Henriques, Isabel Pinheiro Torres, Diogo Matos Horta and Marta Boura, Abreu Advogados

Digital Euro Developments The digital euro represents one of the most ambitious projects in the history of European monetary policy. Led by the European Central Bank (ECB), the initia - tive aims to introduce a central bank digital currency (CBDC) that complements cash and commercial bank money, while supporting Europe’s strategic autonomy in payments and digital finance. Following the preparatory phase, which took place between November 2023 and October 2025, approval of the digital euro framework has moved significantly closer. The ECB has indicated that, subject to the adoption of the Digital Euro Regulation by the EU co- legislators during 2026, the first issuance could take place in 2029. From a regulatory perspective, the digital euro aims to promote financial inclusion and provide a pan-Euro - pean digital payment solution. It is designed to ensure that payments can be made across the EU under all conditions, maintaining accessibility, resilience and inclusivity as core guiding principles. For the fintech sector, the digital euro presents signifi - cant opportunities, particularly through the potential for programmable payments – that is, payments that can be executed automatically once predefined con - ditions are met – which are being actively explored as part of the ECB’s innovation platform. This capabil - ity could enable new business models in areas such as conditional e-commerce transactions, milestone- based services and recurring, usage-based billing, complementing core payment solutions, digital wal - lets and mobile payment services. E-commerce plat - forms, payment service providers and digital finance operators will need to adapt their technological infra - structures to integrate such advanced functionalities, while ensuring robust cybersecurity, effective data protection and resilient operational frameworks to support a smooth transition to an increasingly digital and programmable payments landscape. Overall, the implementation of the digital euro repre - sents a meaningful opportunity for fintech companies across the EU to develop value-added products and services around this new payment instrument.

product innovation and client advisory. The practical benefits are significant, including improved approval rates, reduced fraud losses and enhanced customer satisfaction. AI also offers substantial advantages in risk model - ling and regulatory compliance. AI systems can now simulate multiple macroeconomic and microeconomic scenarios, helping institutions assess resilience to adverse conditions and evaluate credit risk more effi - ciently. As governance frameworks continue to evolve within the European Union, firms that prioritise trans - parency and auditability in their AI systems are more likely to build trust with both regulators and custom - ers. As AI systems increasingly handle sensitive data and support critical decision-making, robust cybersecurity frameworks will become a top priority for firms using these technologies, such as continuous threat moni - toring and strong incident response capabilities. From a regulatory perspective, the EU Artificial Intelli - gence Act (the “AI Act”), which will become fully appli - cable on 2 August 2026, represents a major milestone. Under the AI Act, systems intended to evaluate the creditworthiness or establish the credit score of natu - ral persons are classified as “high-risk AI systems”. As a result, fintech companies – whether developing AI solutions in-house or relying on third-party provid - ers – will be required to implement robust governance structures, ensure high-quality datasets, establish effective human oversight mechanisms, and maintain comprehensive technical documentation. Compliance with these requirements will require closer collabora - tion between technical teams, legal and compliance functions, and regulatory authorities. Finally, AI-driven regulatory technology (regtech) and supervisory technology (suptech) are becoming indispensable tools in Europe’s increasingly complex regulatory environment. Automated compliance moni - toring, real-time reporting and AI-assisted risk assess - ments are enhancing both regulatory oversight and institutional compliance. As a result, AI is expected to play an increasingly important role in supporting regulatory compliance and contributing to financial stability across the European fintech ecosystem.

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