😱United Kingdom🇬🇧: Central Bank moves forward with a proposal for an alternative payment system to cards

😱United Kingdom🇬🇧: Central Bank moves forward with a proposal for an alternative payment system to cards

The initiative is expected to enable consumers to make purchases directly from their bank accounts, reducing reliance on traditional debit and credit card networks. Working groups involving representatives from the financial sector and other industries are already being formed, and a public consultation is expected to be launched in the coming months.

🤩 Geopolitics: debit and credit cards—inevitably mediated by U.S.-based networks Visa and Mastercard🇺🇸—currently account for nearly two-thirds of all transactions. With cash payments representing no more than 10%, U.S. companies play a dominant role in the payments ecosystem. An alternative system could help reduce this dependency.

🤩 Enhancing competition: by increasing competition, the central bank also aims to lower costs for small businesses, which typically pay fees up to four times higher than large retail chains.

🤩 Operational resilience: having multiple payment options would help sustain economic activity in the event of cyber incidents or technical disruptions.

🤩 Integration strategy: the plan also considers how existing forms of money could be integrated with stablecoins or a potential central bank digital currency (CBDC), thereby reducing the cost of cross-border payments.

The central bank emphasizes that these new options will not fully replace card payments but are intended to create a more balanced competitive landscape.

#news #Europe #UnitedStates

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