The EU payments sector has changed significantly over the past decades. Payments have progressively become more digital to keep pace with consumer demand. The use of physical card payments has more recently been followed by the advent of digital wallets and national digital payment applications, allowing card and (instant) credit transfers to be made via mobile phones. Digital payment solutions have emerged for making payments in various ways online and at the point of interaction.
The latest payment methods offered by domestic and international providers (both recent and established) try to make the consumer’s payment experience more seamless. New entrants to the market include technical service providers and third party providers, as well as national collaborations between banks. International players are also providing innovative forms of payment, some of them quite successfully.
Europe’s payments landscape is dynamic and well-functioning, featuring a considerable increase in innovation and competition over the past few years. This has resulted in a more competitive and fair market, increasingly based on digital solutions that combine innovation with security. However, even though the EU has been at the forefront of payment digitalisation for decades, it has started losing ground in terms of reach and scalability, operating only in individual Member States and not at the EU level. As the payments landscape evolves, EU retail payments must be reinvigorated to meet current challenges and prepare for future ones.
This Task Force report outlines the current state of retail payments in the EU. It discusses how to further develop a competitive and fair market that benefits both the European industry and consumers. It also highlights the need for regulators and market players to collaborate in order to support continued innovation in the payments landscape that meets the expectations of consumers and merchants. Ensuring the security of payment solutions and protecting consumers from fraud is also fundamental to market resilience. The report concludes with a series of policy recommendations aimed at fostering a dynamic, competitive, resilient, fair, and secure payments market in Europe.
To read a CEPS Expert Commentary that summarises the report’s key findings, click here.
