Originally published February 2026. Updated 23 April 2026.
EBM NEWSDESK ANALYSIS
On 2 February 2026, the European Payments Initiative (EPI) and the EuroPA Alliance signed the agreement that for the first time gives Europe a credible domestic alternative to Visa and Mastercard at scale. The deal connects approximately 130 million users across 13 countries, builds on the digital wallet Wero, and arrives weeks after ECB President Christine Lagarde told Irish radio that Europe needs its own digital payment system “urgently” — warning that virtually all European card and mobile payments currently flow through non-European infrastructure. Visa and Mastercard process roughly $24 trillion in transactions annually between them, and the data trail leaving European jurisdiction every time a card is tapped is now treated by Brussels as a strategic vulnerability on par with energy dependence. Updated 23 April 2026.
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SubscribeThe deeper read is that European payments sovereignty has stopped beinga regulatory aspiration and become a commercial reality. Whether the execution moves fast enough to matter is the question the rest of this decade answers — and the window for displacing the incumbent US networks is closing as Visa and Mastercard accelerate their own next-generation infrastructure plays.
The Problem No One Thinks About
Every time a European taps a card, pays online or splits a bill with friends, the transaction flows through infrastructure owned and operated by American companies. Card payments account for 56% of all cashless transactions in the EU. The data — who bought what, where, when and for how much — leaves European jurisdiction every time.
“It’s important for us to have digital payment under our control,” Lagarde told The Pat Kenny Show. “Whether you use a card or whether you use a phone, typically it goes through Visa, Mastercard, PayPal, Alipay. Where are all those coming from? Well, either the US or China.”
The host’s response — “I didn’t realise this” — captured the European blind spot. Most consumers have no idea their payment data routinely exits the EU. In a geopolitical environment where Europe is scrambling to reduce dependence on the United States across defence, energy and trade, payments remained an overlooked vulnerability until very recently.
The lesson of Russia sharpened the urgency. When Western sanctions cut Russia off from Visa and Mastercard in 2022, the country’s domestic payments were immediately disrupted. European policymakers asked the obvious question: what would happen if the US decided — or was pressured — to restrict European access to those same networks? In an environment of escalating tariff disputes, that question is no longer hypothetical.
What Wero Actually Is
The European Payments Initiative — a consortium of 16 major banks and payment processors including BNP Paribas, Deutsche Bank and Worldline — launched Wero in July 2024 as Europe’s answer. Built on SEPA instant credit transfers, Wero lets users send money using just a phone number. No IBAN. No card. No intermediary.
The traction is no longer theoretical. Wero now has over 47 million registered users in Belgium, France and Germany, has processed more than €7.5 billion in transfers, and counts more than 1,100 member institutions. Retail payments went live in Germany at the end of 2025 with merchants including Lidl, Decathlon, Rossmann and Air Europa accepting Wero online. France and Belgium follow through 2026. The merchant adoption curve is steepening faster than EPI itself forecast a year ago.
The 2 February Agreement Changes the Maths
The breakthrough that turns Wero from a regional payments experiment into a continental contender came on 2 February 2026, when EPI signed a memorandum of understanding with the EuroPA Alliance — the coalition of national payment systems including Italy’s Bancomat, Spain’s Bizum, Portugal’s MB WAY and the Nordics’ Vipps MobilePay.
The deal instantly connects approximately 130 million users across 13 countries, covering roughly 72% of the EU and Norway population. Cross-border peer-to-peer payments launch this year, with e-commerce and point-of-sale payments following in 2027. For the first time, a Belgian consumer buying from an Italian retailer or a Spanish customer paying a French freelancer will not have to route the transaction through an American network.
“European payment sovereignty is not a vision, but a reality in the making,” said Martina Weimert, CEO of EPI.
Why Previous Attempts Failed
Europe has tried this before and failed. The Monnet Project, launched in 2008 by twenty European banks, collapsed in 2012. The original EPI vision itself was scaled back after several founding members withdrew, forcing a pivot from a full card-replacement scheme to a narrower account-to-account model.
The core problem has always been fragmentation. Each EU country developed its own domestic payment solution — Bizum in Spain, iDEAL in the Netherlands, Payconiq in Belgium, Girocard in Germany — but none could work across borders. A Belgian consumer buying from a Dutch retailer still needed Visa or Mastercard. National pride and competing banking interests repeatedly sabotaged attempts at unification.
The network effect compounds the challenge. Merchants accept Visa and Mastercard because consumers carry them. Consumers carry them because merchants accept them. Breaking that loop requires either regulatory force or a critical mass of users large enough to make merchants care — which is precisely what the EuroPA agreement attempts to deliver by connecting existing national user bases rather than building from scratch.
The Digital Euro Question
Running in parallel is the ECB’s digital euro project, which would create a central bank-backed digital currency usable across the eurozone. EU finance ministers have accelerated discussions on the initiative, though the European Parliament has not yet passed the required legislation. Once approved, the ECB estimates a further two to three years to launch.
EPI is careful to distinguish Wero from the digital euro. Wero is a private-sector initiative; the digital euro is public money. The two are designed to complement rather than compete — though the overlap in ambition is obvious. Both exist because Europe’s political establishment has finally accepted that payments sovereignty is as strategically important as energy independence or defence autonomy. That shift is part of a broader structural realignment explored in our analysis of how digital banking is rewriting Europe’s financial system.
The Mastercard Counter-Move
While Europe builds, the incumbents are not standing still. Mastercard’s $1.8 billion acquisition of stablecoin infrastructure provider BVNK is the clearest signal yet that the existing networks are buying their way into the next generation of payment rails. BVNK is a European-built fintech, which makes the deal both strategic and structurally awkward for the European sovereignty narrative — the company most threatened by Wero’s ambitions has just acquired one of the European fintechs Wero would otherwise have benefited from.
Visa is following a similar logic, expanding its stablecoin settlement capabilities and integrating directly with banks across Europe to embed itself deeper at the software layer rather than competing on consumer-facing wallets. The race is not simply between European ambition and American incumbency. It is between the speed at which Europe can build genuine sovereign infrastructure and the speed at which American networks can evolve their architecture so that European displacement becomes commercially impossible.
Can It Actually Work?
Sceptics have good reasons for doubt. Creating a viable alternative to Visa and Mastercard requires “several billion euros” in investment, according to EPI’s own estimates. Low interchange fees under EU regulation make profitability difficult. Consumer habits are deeply entrenched. And neither Visa nor Mastercard will sit idle while Europe tries to dismantle their most profitable market.
Weimert herself concedes that calling Wero a “challenger” may be premature, describing it as functioning like a startup — albeit one with €500 million in backing and 47 million users already on board.
The political tailwinds, however, are stronger than they have ever been. The EU’s instant payments regulation, the Capital Markets Union push, the broader drive for European strategic autonomy in a world of tariff wars and great power rivalry — all point in the same direction. The question is no longer whether Europe wants its own payment infrastructure. It is whether it can execute fast enough to matter.
As Lagarde put it: “We have the assets and opportunities to do that ourselves. And if we were to remove the internal barriers that we have set for ourselves in Europe, our economic wealth would increase significantly.”
The Window That’s Closing
The timing of Europe’s payments sovereignty push is not accidental. It arrives at the moment when the geopolitical case for reducing American financial infrastructure dependency has become impossible to ignore — and when the commercial alternatives are finally mature enough to be credible.
But the window is open and will not stay open indefinitely. Every year that Wero delays its merchant rollout, every quarter that the digital euro legislation stalls, is a year in which Visa and Mastercard deepen their integration into European financial infrastructure at the software layer. Each acquisition Mastercard makes in European fintech makes displacement harder, not easier. The fintechs already challenging Visa and Mastercard from below are creating pressure from one direction. Wero and the EuroPA network from another. Whether those forces converge fast enough to shift where $24 trillion flows each year is the question European policymakers will be answering for the rest of this decade.
The assets are there. The will is there. What remains is execution — and time.
