Europe's payment apps can share rails. The hard part is the rulebook
Five national mobile payment schemes have agreed to link up against Visa and Mastercard. Interoperability is the easy half. Refunds, fraud liability and one contract per merchant are what the incumbents actually sell.
When you tap a card, two American companies, Visa and Mastercard, carry the message and set the rules for what happens if the payment goes wrong. Several European countries have their own bank-run phone payment apps that only work at home. Five of them have now agreed to link up into one cross-border network aimed at the card giants.
Linking Europe's payment apps solves the easy problem, which is reach. What makes cards hard to dislodge is the rulebook behind them - refunds, fraud liability, one contract per merchant - and none of that has been published.
What the card networks actually sell
Visa and Mastercard barely own a wire. The money in a card payment moves through banks. What the networks move is a message, and what they sell alongside it is a set of promises about the day the payment goes wrong: the merchant gets paid, the buyer can reverse the charge when the parcel never shows up, fraud losses land on a party named in advance, and one acceptance contract works in every country the brand operates in. That bundle, not the messaging, is the moat.
Five of Europe’s domestic payment schemes — Bancomat, Bizum, Wero, Sibs-MB WAY and Vipps MobilePay — have now agreed to build a cross-continent network aimed squarely at the two American incumbents. The engineering is tractable. These are modern, account-based systems with national adoption their owners earned the hard way. What has not been shown is whether anyone has written the promises down.
Reach is the cheap half
Payments is a two-sided market, and the famous difficulty is that consumers go where merchants are while merchants go where consumers are. Linking five national schemes solves the consumer side almost by decree: millions of people who already have an app can suddenly reach each other across borders. That is a real achievement for person-to-person transfers and for the political argument that Europe should not clear every retail payment through firms headquartered in California and New York.
It does not put a single new acceptance point in a shop or a checkout page. A scheme that works beautifully between two phones in different countries and nowhere in between is a contact list, not a card network. The question for anyone in Purchase or Foster City reading this is not whether Europeans can now pay each other. It is whether a merchant in Hamburg will be offered one agreement that works for a Spanish customer, a Portuguese one and a Norwegian one, with the same rules for each.
Finality is a feature and a problem
Instant account-to-account payments are built to be irrevocable within seconds. That is the point: it removes settlement risk and it is why the rails are cheap. It is also precisely what a buyer does not want when they have paid a stranger for something that never arrives. The card chargeback exists because consumers will not hand money to unfamiliar merchants without a way to get it back, and someone — the acquiring bank, ultimately the merchant — carries that risk.
So the alliance faces a tension it cannot engineer away. Offer no dispute rights and the network stays a transfer tool for people who already trust each other. Offer dispute rights and somebody must fund them, which means a cross-scheme fee charged to the merchant side. A fee charged to the merchant side to fund consumer protection is interchange by another name, and interchange is the thing European policy spent a decade capping. The pitch “cheaper than cards” and the pitch “as safe as cards” pull in opposite directions, and the rulebook is where that fight has to be settled.
Then there is credit
Cards are also a lending product. A meaningful slice of card spending is deferred, revolving or otherwise funded by the issuer rather than the balance in a current account. A push payment from a bank account is debit by construction. Nothing stops a participating bank bolting credit onto a wallet, but that is a separate product with separate underwriting, separate regulation in each country, and no guarantee of a common experience across five schemes.
Five owners, one committee
Visa and Mastercard write one rulebook and enforce it on thousands of member banks, with the power to fine them. This alliance is five scheme owners, each answering to national banking communities, national supervisors and incumbent fee arrangements, plus the euro-area wallet project. Every meaningful rule — refund windows, fraud liability allocation, who eats currency conversion between the euro and the Nordic currencies, what happens when one scheme’s bank is slow to respond — is a negotiation among parties who can each walk away. Committees produce interoperability. They are much worse at producing enforcement.
The case against this argument
The strongest counter is that nobody needs to kill the card networks to win. A credible domestic substitute disciplines incumbent pricing even at modest share; merchants acquire a walk-away threat they have never had; and the political economy in Europe is unusually favourable, with instant payments mandated and strategic autonomy fashionable. On that view the alliance is already doing its job by existing.
I accept the mechanism and reject the timing. Price discipline requires a substitute a merchant could plausibly adopt next quarter, which means acceptance, dispute rules and a predictable cost, all published. Incumbents respond to that. They do not respond to a shared logo and a statement of intent, and the European payments landscape already contains more than one initiative that got as far as the announcement.
What would settle it
One document would settle it: a common rulebook binding all five schemes, covering who refunds a buyer whose goods never arrive, who bears fraud losses, what a merchant pays, and when in-store and online acceptance begins outside each scheme’s home market. Everything else is a question of will.
The five schemes should publish a single cross-scheme rulebook — dispute rights, fraud liability allocation, the fee that funds them, and dated commitments for in-store and e-commerce acceptance outside each home market — rather than another statement of intent. Until that exists, European officials should describe this as an interoperability project, which is useful, and stop describing it as competition for the card networks, which it is not yet.
Merchant associations, who are the only party with a real incentive to test the claim, should say publicly what acceptance terms they would need before switching volume, and hold the alliance to them.
What would change this view
I am wrong if, by the end of 2027, the alliance publishes one common rulebook binding all five schemes that sets refund and dispute rights for a buyer whose goods never arrive, allocates fraud losses between payer bank, payee bank and scheme, and fixes a cross-scheme fee — and if named large retail chains are accepting the resulting instrument in-store or at online checkout outside each scheme's home market.
If that happens, the alliance is a card network in everything but the plastic, and the right question becomes whether European regulators will let it price the dispute cover it needs while capping the incumbents' interchange. I would rather be shown the rulebook than the logo wall.
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- European payments groups join forces to take on US giants
Finextra · 2026-10-01