Europe's Mobile Wallet Boom
Instant payment-based mobile wallets are on the rise all over the world, as is evident with the likes of Brazil’s Pix and India’s UPI.
Europe is no different, and many countries have their own champions. Whether that be the Netherland’s iDEAL or Poland’s Blik, these have all experienced tremendous success in the last decade or so.
Now, these mobile wallet solutions have more of a chance than ever before to become EU-wide and interoperable, with initiatives such as Wero beginning to take shape in western Europe, and the cross-border integration of BANCOMAT, Bizum, and SIBS being officially launched in Italy, Spain, Portugal and Andorra.
In this video, Paylume’s Andrew Gomez talks us through the European wallet landscape today, and what Europeans can expect in the future.
How are wallet solutions increasing their reach?
Across Europe, there is momentum for mobile solutions to be a success, both from the public and private sector. The European Commission and European Central Bank alike have been keen to see these homegrown solutions grow and potentially compete with the international card schemes.
The European Payment Initiative’s Wero solution, which is backed by a coalition of European banks across key EU economies such as France and Germany, has begun to roll-out its payment solution in recent years, building on the domestic solutions that are already in existence. After a rocky start, which saw some banks exit EPI and the fledgling company back away from its original card scheme plans, it has now seemingly found more success by harnessing the local mobile payment solutions in the countries that its founders operate in.
In Benelux, Payconiq in Belgium and Currence, the company behind the successful Dutch e-commerce solution iDEAL, have been folded into Wero. In France, the banks involved have migrated their users from Paylib, while the German banks are in the process of integrating the Giropay and Paydirekt solutions into Wero.
How Wero is integrated differs: some banks have chosen to integrate the wallet into their own banking apps, while others are directing customers toward the standalone Wero application.
For now, the focus is on peer-to-peer payments, but there are plans to expand into areas such as ecommerce and even point of sale. Across these countries, a strong marketing push has been launched to familiarise consumers with the service and build traction among potential new customers.
The second regional champion has taken a very different approach, being reluctant to invest in a new brand and instead building on the strong equity of existing domestic solutions.
Interoperability agreements have been reached between Italy’s Bancomat Pay, Portugal’s MB WAY, and Spain’s Bizum, allowing users of these services to transact seamlessly across borders.
In comparison to Wero, this model relies on leveraging successful national schemes and promoting interoperability rather than creating a new service that must win over customers from scratch. It reduces the time and investment required to acquire a strong user base, onboard merchants, build ubiquity, and expand into revenue-generating use cases.
Consolidation is also taking place in the Nordics, where Denmark’s MobilePay, Finland’s Pivo, and Norway’s Vipps joined forces in 2021.
This hybrid approach, building a common company while retaining strong national brands, sits somewhere between the two models outlined above whereas in central and eastern Europe, Poland’s BLIK has expanded into Slovakia and is now moving into Romania.
Launched in 2015, Blik took several years to build scale, but today it has become the de-facto payment method in Poland, and in 2024, had some 17 million active users.
What happens next?
The question for Europe is whether it can expect further consolidation, leading to a single European champion that is capable of competing with Visa and Mastercard?
Or, will the market remain fragmented, with a patchwork of local and regional schemes?
Although economies of scale argue for consolidation, there are still undeniably diverging preferences and habits across Europe that suggest that the continent will for now remain a mosaic of regional initiatives.
For these companies, the best hope lies in interoperability, and perhaps, in the longer term, even in how it can adapt to the digital euro.
