Wero, a payment rail developed by a consortium of some of Europe’s biggest banks, is being rolled out across Western Europe.
Following a quiet launch at a few German banks in July, Wero is now going live in Belgium and France. The pay-by-bank solution will eventually allow, for example, a Belgian tourist to pay for a hotel room in Germany instantly and directly from their own bank account.
Touted as a challenge to the dominance of Visa and Mastercard, the service is backed by 16 major European banks and payment processors including BNP Paribas, Deutsche Bank, and Worldline, under the banner of the European Payments Initiative (EPI).
Wero users can already complete person-to-person transactions in under 10 seconds using a QR code, email address, or phone number. If all goes as planned, the service will eventually include the ability to transfer and request money to and from third parties, as well as facilitate cross-border payments between users.
By 2025, EPI anticipates that Wero will be able to provide direct in-wallet payments to SMEs, enable online merchant payments via a QR code, manage recurring payments, in-store payments, expense sharing, and buy now, pay later capabilities.
Sophia Gonzalez, a Debit Payments Analyst at Javelin Strategy & Research, pointed out that Wero could have several advantages with European consumers. “From the consumer perspective, pay-by-bank is very similar to debit,” she said. “Europeans already have a preference for debit.
“Consumers are not concerned about using Visa or Mastercard because it does not impact them. Where it may impact them is if the merchant enforces a surcharge for credit or debit payments at the point of sale. As a pay-by-bank solution, Wero would be exempt from this hypothetical surcharge.”
A Rail Just for Europe
The project grew from the belief that Europe needed its own payment rail rather than relying heavily on Mastercard and Visa. EPI launched in July 2020 with the goal of developing a fully digital payment solution designed to meet the business demands of the 21st century.
The immediacy of the project was further fueled by Visa and Mastercard suspending their operations in Russia after the 2022 invasion of Ukraine. The move prevented overseas payments by Russian cardholders and kept foreigners from making transactions within Russia’s borders.
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Arwen Volkov, A graduate of the University of St. Gallen in Switzerland with a degree in International Finance, Arwen specializes in sustainable finance and green investments. She began her career at an investment bank in London, where she developed financing models for environmentally friendly projects. Known for her analytical and strategic thinking skills, Arwen is a sought-after financial consultant. In her spare time, she mentors fintech startups, contributing to their growth strategies. She is also a nature enthusiast and an amateur photographer.
