ICMA publishes new paper on creating the conditions to scale up the European commercial paper market
19 November 2025 The International Capital Market Association (ICMA) has today released a new paper entitled "Creating the conditions to scale up the European commercial paper market", which explores practical steps to strengthen, harmonise and expand the European CP market.
The analysis sets out how a more transparent, standardised and diversified CP ecosystem could support deeper capital markets, enhance short term funding options for issuers and advance policy objectives under the European Commission’s Savings and Investments Union plan.
The paper highlights that the European market, valued at around EUR 1.27 trillion, is sizeable but fragmented across several distinct segments. While each works effectively in isolation, this fragmentation leads to operational complexity, uneven transparency and limited scalability compared with the more standardised US CP market. Despite these challenges, European CP has shown strong growth and resilience since 2022.
Key Highlights:
Transparency
- The absence of a consolidated, publicly accessible source of issuance and pricing data limits price discovery and market confidence. Centralised data aggregation, potentially via a European public authority, would support clearer curves, better valuation and more efficient secondary activity.
Standardisation
- Differences in documentation, settlement systems, denominations, maturities and governing law create friction and cost. Greater alignment in these areas could streamline operations, reduce legal complexity and improve accessibility for both issuers and investors.
Diversity of issuers and investors
- Broadening CP eligibility to a wider spectrum of credit profiles, alongside recalibrating elements of the MMF Regulation and Basel III, would boost supply and demand. Encouraging European retail participation in MMFs and reallocating corporate cash from deposits to market based instruments could materially expand the investor base.
Additional structural measures
- Growth in European asset backed commercial paper, a functioning repo market for CP, broader HQLA recognition and expanded central bank eligibility would all contribute to deeper liquidity and greater market stability.
Innovation
- With its contained scale and short term nature, the CP market is a strong candidate for process digitisation and DLT based solutions. Tokenised MMF units, in particular, hold potential to improve collateral mobility and reduce operational friction.
Overall, the paper concludes that targeted regulatory alignment, increased transparency, stronger standardisation and selective technological adoption can help unlock the full potential of the European CP market, enabling it to play a more central role in Europe’s short term funding landscape.
Download the full paper here.
