European card transactions will decline as A2A payments gain traction

editorial

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EPI (European Payments Initiative) – a pan-European bank-backed company created specifically to create a competitor to Mastercard and Visa on the continent – ​​began launching its Wero mobile-first wallet and instant account-to-account Account payment system over the summer.

In its 20th annual World Payments Report 2025, Capgemini predicts that EPI and other A2A payments offerings such as Pix in Brazil and UPI in India will disrupt the payments landscape.

Cashless transactions are predicted to reach 2,838 billion by 2028 – double the number in 2023. However, cards will not be the only alternative to benefit from the switch from banknotes and coins.

According to the report, A2A payments could offset 15-25% of future card transaction volume growth and cost the industry billions in interchange fees and interest expenses. According to Capgemini, EPI’s Wero wallet is expected to accelerate the adoption of A2A payments as card transactions are predicted to decline by 37% across Europe by 2027.

The report suggests that banks need to jump on the wave of adopting instant payments but are deterred by fears of fraud. Because banks lack robust defenses and may face liquidity issues, many are choosing to receive instant payments but not send them. Today, only 25% of banks can receive instant payments and 53% are fully capable of sending and receiving them.

Based on a survey of executives, the report shows that only five percent of banks demonstrate high business and technology readiness to cement their position as leaders in instant payments adoption.

Even in Europe, only 13% can claim to have a strong technology base for instant payments, despite the October 2025 Instant Payment Regulation (IPR) deadline requiring all to offer full functionality.

Jeroen Hölscher, Global Head, Payment Services, Capgemini, says: “The continued rise of cashless transactions is a turning point for banks and payment service providers. The data points to an inevitable shift towards a future of instant and open payments.

“The progress made at Pix in Brazil and UPI in India has clearly shown that success depends on collaboration between the private and public sectors. While some financial institutions may upgrade their existing payments hub or leverage shared banking infrastructure, the fact remains that consumers demand immediacy and businesses are hungry and willing to pay a premium for innovative solutions that solve real business problems.”