Europe’s Payments Power Struggle: How Fintechs Are Taking on Visa and Mastercard

Europe’s payments industry is undergoing its most profound upheaval in half a century. For decades, Visa and Mastercard have quietly sat at the centre of global commerce, collecting a toll on every card transaction, cross-border payment and merchant swipe. Today, that model is being challenged by a wave of European fintechs, regulators and merchants who believe the old system is too slow, too expensive and too American.

From London to Amsterdam, Paris to Stockholm, Europe is becoming the world’s most competitive payments battlefield — and the outcome will reshape how companies, consumers and governments move money across the continent.

At stake is nothing less than control over a multi-trillion-euro financial artery.

The Visa–Mastercard chokehold

Together, Visa and Mastercard process the vast majority of Europe’s card transactions. Their networks sit invisibly behind banks, fintechs and merchant terminals, charging fees that flow back to the US-based giants every time a European business accepts a card payment.

These so-called “interchange” and “scheme” fees are tiny in isolation — often fractions of a percent — but at continental scale they amount to billions of euros annually. In countries such as France, Germany and Italy, merchants have long complained that the system acts like a tax on commerce, especially for small businesses operating on thin margins.

As Europe pushes for greater financial sovereignty, payments infrastructure is now being viewed as strategically important — alongside energy grids and data networks. That shift in thinking has opened the door to a new generation of challengers.

Fintechs sense a once-in-a-generation opening

Companies such as Revolut, Wise, Adyen, Klarna, Stripe, Worldline and Checkout.com are no longer fringe disruptors and are not just startup banking in Europe anymore. They are global financial platforms handling hundreds of billions of euros in annual volume.

Their advantage lies in software-driven infrastructure that connects bank accounts, FX, cards and compliance into one system. That is why European companies are increasingly turning to multi-currency business accounts rather than relying on legacy banks and card networks.

By moving money directly between accounts instead of routing it through card rails, fintechs can dramatically reduce costs, speed up settlement and give businesses far more control over their cash.

Instant payments threaten the old model

The most serious threat to Visa and Mastercard is not new cards — it is instant bank-to-bank payments.

Across the EU, regulators are mandating the rollout of SEPA Instant Credit Transfer, allowing money to move between accounts in seconds, 24/7. This enables merchants to accept payments directly from customers’ bank accounts without involving card networks at all.

European processors such as Adyen and Worldline are now embedding instant payments into ecommerce checkouts, in-store QR codes and B2B invoicing. Klarna is layering its buy-now-pay-later model on top of bank-to-bank rails.

For Visa and Mastercard, this represents an existential challenge. Every transaction that moves through instant payments is one that no longer pays a toll to their networks.

Corporate cards and expense platforms become a battleground

The fight is particularly intense in the corporate market.

Corporate cards and expense management platforms are one of the most profitable segments in payments — and one where fintechs are rapidly taking share from banks.

Platforms such as Revolut Business, Wise Business, Pleo, Soldo, Airwallex, Brex and Payhawk allow companies to issue cards, manage spending, automate expense reporting and pay suppliers in multiple currencies from a single dashboard.

That is why corporate cards and expense accounts have become one of the most competitive fintech categories in Europe. These platforms sit at the heart of how modern businesses operate — and whoever controls them controls enormous data, fees and customer relationships.

Brussels enters the fray

European regulators are no longer neutral observers.

The European Commission has launched multiple investigations into Visa and Mastercard over pricing and competition. At the same time, it is pushing through reforms designed to:

Cap interchange fees

Mandate instant payments

Enforce open banking access

Increase transparency across payment networks

The goal is not to eliminate card schemes, but to ensure they are no longer the only route for digital commerce.

This regulatory pressure is one reason why so many companies are shifting away from traditional banks toward digital business banks that integrate payments, FX and card services into one modern platform.

How markets are re-pricing payments

Investors are already responding. European payments firms are now being valued less like financial institutions and more like technology infrastructure companies. Adyen has become a core pillar of global ecommerce. Worldline dominates continental card processing. Klarna is reinventing itself as a full-stack payments and checkout provider.

Traditional banks, by contrast, are being pushed into the background — providing the underlying accounts while fintechs capture the user interface, data and margins.

This shift is one of the most important themes in European markets, as capital flows into companies that own the rails of digital commerce.

Why businesses are switching

For European companies, the change is already visible.

A startup operating across five countries no longer wants five bank accounts, five card programmes and five FX providers. It wants one integrated system that handles:

• Payments
• Cards
• Foreign exchange
• Payroll
• Invoicing

That is why more firms are now building their financial stack around modern business banking platforms rather than traditional high-street banks.

These platforms are cheaper, faster and better suited to cross-border trade — which is increasingly the norm for European companies.

The future of European money

The likely outcome of this payments war is not the disappearance of Visa and Mastercard — but a gradual erosion of their dominance.

Cards will remain essential for consumers. But behind the scenes, a growing share of transactions will move through instant payments, account-to-account rails and fintech-owned platforms.

Europe is quietly building a new financial infrastructure — one that is more competitive, more digital and far more European.

The bottom line

This is not a fight over plastic cards. It is a battle over who controls the flow of money, data and fees in the European economy.

Visa and Mastercard built the old toll roads. Europe’s fintechs, backed by regulators and capital, are now building alternative highways.

The companies that win this struggle will shape how trillions of euros move across Europe for decades to come.

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