As Europe pursues greater payment sovereignty, I see our payment ecosystem undergoing a profound transformation driven by the convergence of digital innovation, geopolitics and an increasingly ambitious regulatory agenda. Faced with growing dependence on non European infrastructures, banks, regulators and fintechs are finally moving from diagnosis to action (and they are doing it under time pressure).
Bank led initiatives such as Wero (the instant payment solution driven by the European Payments Initiative) and EuroPA (a federated alliance of national schemes) are emerging as strategic responses to decades of fragmentation and external control. The question is no longer whether Europe needs its own capabilities, but how we build them without destroying what already works well at domestic level.
Europe: A patchwork of payment behaviours?
The European single market has not erased payment cultures. There are dozens of different payment habits and instruments across Europe, and this diversity is not anecdotal. It is the product of long national histories and specific consumer preferences.
Germany remains strongly attached to cash, partly for cultural reasons related to prudence and privacy. France, by contrast, has embraced debit cards at scale, a trend that accelerated sharply during the COVID period in 2020 when contactless became the default gesture at the point of sale. Two neighbouring countries, two very different reflexes at the checkout.
Fragmentation is not just cultural, it is structural. In practice, the only truly universal payment method in the euro area is still cash protected by its legal tender status (a merchant may refuse a card, but not banknotes and coins). For all other instruments such as transfers, cards, cheques or digital wallets, acceptance depends on commercial choices and on the reach of national or scheme infrastructures.
Paradoxically, this diversity sits on top of a shared foundation. For about 12 years, SEPA has standardised cross border credit transfers and direct debits across 36 countries, creating a baseline of interoperability for account to account payments. Today’s new initiatives including Wero and EuroPA are building on that foundation, but with very different philosophies.
Wero and EuroPA: Rivalry or complementarity?
Under its commercial brand Wero, the European Payments Initiative embodies an ambition initially driven by France, Germany and Belgium to create a European instant payment solution with genuine scale.
The core innovation is not instant settlement itself (that already exists) but the user experience. Traditional bank transfers are constrained by the need to manipulate IBANs that consumers and merchants do not want to exchange or type. No waiter will hand over their bank details so you can pay for a coffee, and no ecommerce checkout can be built at scale on manual IBAN entry.
Wero addresses this by allowing payments to a mobile number or email address, which is mapped to the underlying bank account. On top of that, Wero is designed to support value added services such as deferred settlement, transaction cancellation, refined fraud controls and new use cases for merchants and consumers.
However, this standardised approach has collided with realities in markets such as Spain, the Nordics and parts of Eastern Europe where domestic instant payment solutions are already mature and widely adopted. These countries have grouped under EuroPA (the European Payment Alliance) which promotes a different vision. Each country keeps its own brand and its own solution, while interoperability is ensured by cross border gateways rather than by a single pan European front end.
From the perspective of these countries, Wero initially looked like a top down project arriving with fixed standards at the expense of successful local systems. After months of tension, a rapprochement was announced in June 2025. In principle, Wero and EuroPA now commit to cooperate. Technically, peer to peer payments are the easiest layer to unify. The real battlefield will be merchant and ecommerce acceptance where commercial models, value added services and technical integration are far more complex and politically sensitive.
Are European banks regaining control?
European banks face several simultaneous pressures.
First, they are strategically dependent on non European card schemes. Visa and Mastercard remain dominant across Europe. In geopolitical terms, this dependence is not theoretical. In 2014, after Russia’s first invasion of Crimea, Visa payments for Russian users were cut off under political pressure. That episode showed how access to payment rails can be weaponised when control lies outside your jurisdiction. For Europe, relying almost entirely on non European card networks is a strategic vulnerability. Building alternatives represent credible options if the geopolitical environment deteriorates again.
Second, their economic model on instant payments is under pressure. Regulation tends to push instant transfers towards zero pricing for consumers, while infrastructure, fraud management and liquidity costs remain significant. In this context, Wero is an attempt by banks to move up the stack by layering new services (guarantees, dispute processes, value added data, richer merchant services) onto instant rails, especially on the merchant side where monetisation is more acceptable. If banks simply provide free instant rails without building paid services on top, they will end up bearing the cost of infrastructure without capturing the value.
Third, they are exposed to platform risk from Big Tech, in particular Apple. Apple Pay illustrates a different kind of threat. Apple has placed itself directly between banks and their customers at the point of interaction, while capturing a meaningful slice of interchange revenue. For many banks, refusing Apple Pay is not realistic. If they do not offer it, they risk losing customers to competitors who do. This raises a fundamental sovereignty question. If the primary user experience, authentication layer and customer interface sit with Big Tech, banks risk becoming invisible balance sheet utilities with limited control over pricing, data and customer relationship.
The role of domestic schemes and CB
In this environment, domestic card schemes remain critical assets. Today in Europe, only a limited number of countries still operate strong national card networks alongside the global giants. Cartes Bancaires in France, Girocard in Germany, Bancontact in Belgium and Multibanco in Portugal are among the most important.
The French CB scheme (over 40 years old) remains particularly powerful in terms of market share and cost efficiency. Reinforcing CB and ensuring its deep integration with new account to account solutions such as Wero or EuroPA is one of the clearest paths for French banks to preserve strategic autonomy while still working with global networks where it makes sense.
The challenge for banks is to avoid a binary choice between national and international and instead design hybrid models in which domestic schemes, instant payments and global card networks are orchestrated intelligently by the banks themselves.
Where is the payment revolution heading?
I see three structural trends that will shape the next decade.
Firstly, payment will become progressively invisible. Uber remains the benchmark example. You register your card once and after that you no longer pay in the traditional sense, the payment is embedded in the journey. What remains visible is the customer experience (discovery, configuration of the service, authentication and consent). The payment itself recedes into the background. This logic is now extending into what we call agentic commerce. AI agents act on behalf of consumers, able to search, compare, select and purchase under explicit mandates and constraints. In such a world, the payment moment disappears almost entirely, but the underlying rails, risk management, liability allocation and authentication become even more critical.
Secondly, digital identity will move to the core of transactions. Europe is pushing ahead with a digital identity wallet. The idea is to enable selective disclosure of attributes (for example proving you are over 18 without revealing your full birth date, or confirming that you hold a valid driving licence when booking and paying for a rental car). I am convinced that digital identity will increasingly wrap and condition payment acts. For some transactions, proving who you are or what you are entitled to do will be as important as moving the money. This identity layer will itself become a zone of competition between banks, Big Tech and public authorities.
Finally, the payment value chain will be reconfigured. Between European sovereignty ambitions, Big Tech pressure and the rise of fintechs, every actor in the value chain is being forced to choose a position. Do you want to be an infrastructure provider, a customer facing platform, an intelligence and risk management layer, or a regulated utility in the background.
Banks cannot afford to be everything to everyone. They will have to make strategic choices about where to cooperate, where to compete and where to accept being a commodity. Payment may be becoming invisible at the front end, but the strategic stakes have never been more visible. We are not at the end of the payment story, we are at the beginning of a new chapter in which control over rails, identity and data will matter more than ever.