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Will PEPSI displace Visa and MasterCard?

Categories : Cash is a symbol of national sovereignty
November 15, 2019
Published in : Card payments, Commercial bank, Europe, National sovereignty
20 European banks are planning the launch of the Pan-European Payment System Initiative -PEPSI - to challenge the dominance of Visa and MasterCard including Europe and counter Big Tech firms.
Guillaume Lepecq

The new payments scheme is aimed at managing all forms of non-cash payments. According to Le Figaro, the initiative is backed by the European Central Bank. One banker is quoted as saying “European payments sovereignty does not exist.”

European payments sovereignty does not exist

Jérôme Reboul, deputy director of the Treasury at the French Finance Ministry said at a banking conference “In two years, the view on the issue of the future of payments has changed completely in Europe”. The project has the ambition to capture 60 percent of the digital payments market in Europe and has already been presented to European governments. It is expected to cost several billion euros. The banks are expected to make a final decision in December on whether to press ahead with it.

In two years, the view on the issue of the future of payments has changed completely in Europe

None of the banks contacted by AFP would speak openly about the plans, But several sources said only banks in the eurozone were involved and that most French and German banks were on board.

This is not the first attempt to create a European scheme. In 2007, the Euro Alliance of Payment Schemes (EAPS) was an international alliance of European bank and interbank networks  aimed at creating a pan-European debit card system using existing country specific systems. The initiative was abandoned sometime after 2013.  In 2010, 12 banks from 8 countries joined the Monnet project, a consortium aimed at creating a European card scheme. The project failed shortly after.

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