NewsRescue
A government-commissioned analysis stated this week that the UK should build a “digital alternative” to challenge the dominance of US payment cards Visa and Mastercard.
“While cards make a tremendous contribution to the payments landscape, we heard notable dissatisfaction with the cost of card schemes on the part of shops, services, and other merchants – which may be in part due to a lack of choice or digital alternatives to the existing card schemes,” the authors of the report said.
The report’s recommendations, dubbed the “Future of Payments Review,” mirror long-standing EU misgivings about the EU’s reliance on American services for card payments. Despite repeated requests and attempts to transition to ‘homegrown’ alternatives, little progress has been made thus far.
The report urged the British payment sector to ramp up the use of open banking technology to bypass the traditional method of transferring money, which requires customers to enter sort codes and account numbers.
“We believe the market would be further improved if there was a viable digital alternative to the card schemes,” said the report’s authors.
Joe Garner, who led the review, emphasised merchants’ and retailers’ comments that they felt “trapped” under the current system. Giving shops the choice to charge without utilising a card network, according to Garner, would result in a “healthier” market, especially as cash use is declining.
