Ag is a promising catalyst for the production of carbon monoxide (CO) via the electrochemical reduction of carbon dioxide (CO2ER). Herein, we study the role of the formate (HCOO−) intermediate *OCHO, aiming to resolve the discrepancy between the theoretical understanding and experimental performance of Ag. We show that the first coupled proton‐electron transfer (CPET) step in the CO pathway competes with the Volmer step for formation of *H, whereas this Volmer step is a prerequisite for the formation of *OCHO. We show that *OCHO should form readily on the Ag surface owing to solvation and favorable binding strength. In situ surface‐enhanced Raman spectroscopy (SERS) experiments give preliminary evidence of the presence of O‐bound bidentate species on polycrystalline Ag during CO2ER which we attribute to *OCHO. Lateral adsorbate interactions in the presence of *OCHO have a significant influence on the surface coverage of *H, resulting in the inhibition of HCOO− and H2 production and a higher selectivity towards CO.