The European Payments Initiative: The next big thing in European payments?

European banks/payment service providers have largely lost their influence in parts of the payment sector over the past 20 years, in particular in card-, mobile- and internet payments. In particular, the market is increasingly dominated by the U.S. card payment scheme giants Visa and MasterCard and other PSPs such as PayPal. Since it has been recognized in the meantime that payment infrastructures are vital to the functioning and the stability of economic systems, after several unsuccessful attempts, the European Payment Initiative (EPI) is again trying to bring about an ECPS, a European payment scheme for card-, mobile- and internet payments. This attempt has been launched to (re)gain sovereignty over payments and reduce dependence on non-European players, especially for intra-European transactions. These efforts are made in a highly competitive situation with a traditional product range and a novelty, instant payments. EPI will require enormous investments for its launch and for successful processing. As a result, the business case is doubtful and there are huge challenges on the issuing and acquiring. It is unclear whether the market will embrace European payment products, or how quickly a critical transaction mass and breakeven point will be reached so that - as desired by the European Union, the ECB and a number of European banks/payment service providers - a degree of European sovereignty over card-, mobile- and internet payments can be regained with the success of the EPI.