Twenty European banks are now working to create a Europe-wide payment system that could eventually allow the continent to bypass Visa, Mastercard and foreign technology giants.

The new Pan-European Payment System Initiative (PEPSI) is aimed at managing all forms of non-cash payments.

Carlo Bovero, in charge of Global Cards at BNP Paribas, referred to the project on Tuesday at a conference organised by the banking magazine, Revue Banque, noting that there have been discussions between banks that represent a large chunk of Europe.

The initiative stems from “positive injunctions” in 2017 from the European Central Bank (BCE) which, “worried about the sovereignty of payments, explained that it would view favourably an examination of the issue,” according to a French banking source close to the subject.

“PEPSI started out not as a technical initiative but a political one,” added the source, pointing to the dominance of Visa and Mastercard in Europe as well as the increasing influence of Chinese payment networks that also wish to tap into the market.

In two years, the view on the issue of the future of payments has changed completely in Europe, Jérôme Reboul, deputy director of the General Treasury Directorate at the French Finance Ministry, whose remit includes payments, said at the banking conference on Tuesday.

Oscar Schneider

The Brussels Times