16 major banks in the euro zone have just kicked off the European Interbank Payment (EPI) project. The aim is to offer an independent European means of payment based on a bank card, a digital wallet and person-to-person payment solutions.
Bringing tangible benefits to European consumers and retailers
A project since 2018, the European Payments Initiative was officially launched on July 2, 2020 by 16 banks, including 6 French ones (notably BNP Paribas, Société Générale and Crédit Agricole).
This project consists of setting up a European system based on several products: a new-generation bank card, a wallet, instant transfers and peer-to-peer payment solutions.
More concretely, EPI will provide European merchants with a transparent and competitive payment solution. Today, almost half of all retail payment transactions in Europe are made in cash.
This new system will also have an impact on bank customers, who will no longer need to enter their bank card number or delivery address on the Internet, for example. EPI comes at a time when consumers are massively turning away from coins and banknotes. This trend has been reinforced since the start of the Covid-19 crisis, which prompted them to make greater use of their payment cards to limit the risk of the virus spreading.
Supporting Europe's digital strategy
EPI will support European public institutions and national authorities. Indeed, the digital payment solutions currently offered in Europe are fragmented and do not enable citizens to pay digitally everywhere. The project therefore aims to converge the European payment ecosystem of banks, merchants and payment service providers.
Over the next few months, this will result in the creation of an interim company in Brussels to finalize the technical and operational roadmap, and launch the work needed to achieve the best possible user experience. Each bank will evaluate the achievements of this interim company before subscribing to the final EPI corporate structure.
European market players, banks and third-party payment service providers have until the end of the year to join the EPI initiative. Entry into the operational phase is scheduled for 2022. In the meantime, participants will have to agree on the planned investments. While the exact budget is not yet known, it is estimated at several billion euros. "It's a private investment supported by the banks," explains Carlo Bovero, payments specialist at BNP Paribas.