The future of digital payments in Europe: the era of EPI

The current payment environment in Europe

In recent years, Europe’s payments landscape has undergone a significant transformation. According to a report by S&P Global Ratings, digital payments are expected to exceed those in cash by 2030, despite the fact that 60% of the Eurozone population continues to prefer cash. This change is fueled by the emergence of new payment solutions, such as the European Payments Initiative (EPI), which aims to create an instant digital payments system
at European level.

What is the European Payments Initiative?

The EPI is an ambitious project born from the alliance of twelve European banks and financial institutions, including well-known names such as BNP Paribas, Deutsche Bank and ING. The main objective is to develop a single, pan-European payment solution, using the SEPA (Single Euro Payments Area) to facilitate transactions. Thanks to this initiative, European consumers will be able to benefit from a wide range of services, from instant payments in physical and online stores, to money transfers between individuals, similar to those offered by Venmo
or PayPal.

The challenges to be faced for the success of the EPI

Despite the EPI’s potential, its success is not guaranteed. S&P stresses that it is essential to have a large member base and acceptance by the population. In addition, the platform’s current inability to connect to non-euro payment schemes represents a potential weak spot. Consumers’ willingness to use the EPI wallet solution could vary considerably from country to country, further complicating adoption. Partner banks also face governance challenges, as the increase in the number of competitors could make it difficult to manage the platform.

The future of digital payments in Europe

In a context where stablecoin payments are gaining ground, EPI could represent a European response to the dominance of giants such as Visa and Mastercard. However, the fragmentation of payment markets could increase with the introduction of new wallets and applications. The issue of the digital euro remains uncertain, but it could further influence the payments landscape. Analysts warn that, to increase adoption rates, use cases need to be clear, reliable, and convenient for consumers
.