The European Payments Initiative (EPI) set out to create a pan-European payment network that utilizes the real time payment solution SEPA Instant Credit Transfer (SCT Inst) and “creates an alternative and independent payment system.” What that really means is that they wanted to free Europe of the U.S.-based global card networks. The plans were to create a mobile app and a card that could be used for purchases and P2P transfers.
The initiative was launched in 2020 with a framework and the buy-in of more than 30 European financial institutions. Finextra reported today that most banks have now dropped out of the project as they found the investment requirements too great. A few banks remain with a new goal of developing a mobile app, presumably one that encompasses existing payment networks.
Here’s what Finextra found:
The European Payments Initiative has given up on its effort to build a rival to Mastercard and Visa in Europe after more than half its members left.
Initially backed by 31 major Eurozone banks and acquirers Worldline and Nets, the EPI set itself the goal of building a unified pan-European payment system, offering a card for consumers and merchants across Europe, a digital wallet and P2P payments.
Backed by the European Central Bank, the scheme was set to enter its operational phase this year, but by last November financing had become a concern for members, prompting a move to seek outside funding.
Now, 20 banks have pulled out, including all Spanish members as well as Germany’s Commerzbank and DZ Bank. French lenders now dominate the group.
In a brief statement on the EPI site, the group says that the 13 remaining shareholders “remain convinced of the strategic value of a unified payment solution ready for commerce leveraging especially instant payments and want to go ahead”.
Overview by Sarah Grotta, Director, Debit and Alternative Products Advisory Service at Mercator Advisory Group
