In Numbers.. Can the "Digital Euro" Save Europe from the Dominance of American "Visa" and "MasterCard"?

SadaNews - Warnings are escalating in European financial circles regarding the near-complete dominance of American companies Visa and MasterCard over the payments market on the continent. This comes at a time when geopolitical tensions are rising, and European officials fear that this financial influence could become a pressure tool that might be used at some point to disrupt payment systems, threatening the economic stability of the European Union.

In this context, a report by the British Financial Times noted that American dominance in the infrastructure of digital payments is no longer merely a market issue but has become a growing institutional concern, as European capitals see this excessive reliance as a "dangerous financial burden" impacting the continent's sovereignty.

The European Central Bank's data reinforces these concerns, as Visa and MasterCard account for about two-thirds of card transactions in the Eurozone, while 13 European countries do not have any effective national alternatives. Even in countries that have developed local systems, their usage is gradually declining as digital payments and applications expand, further deepening the dependence gap.

This comes amid recurring trade and political tensions, bringing back questions about Europe's ability to safeguard its financial structure from any potential external pressures. Former European Central Bank President Mario Draghi warned that "the financial interconnectedness that was once a source of confidence can turn into a tool of influence and control," referring to the fragility of interdependence in times of crises.

The Scale of Influence

While the concerns are primarily political, the numbers reveal the depth of influence on the ground. According to data from Statista and the Nelson Report, the number of purchases made through payment cards globally in 2024 reached approximately 293.5 billion transactions, indicating an unprecedented expansion of the digital payments market.

MasterCard topped the list with 191.5 billion transactions, followed by American Express with 13.2 billion transactions, while the total number of purchases across various payment cards neared 1.1 trillion transactions. In terms of value, the total payments processed via cards reached about $45.5 trillion, according to Datus Insights.

Statistics show that 40% of global business transactions occur through Visa's network, while Visa and MasterCard together account for about 65% of business transactions in Europe during 2024, according to the European Central Bank, highlighting the companies' deep entrenchment in the core of European economic activity.

European Alternatives

In light of this reality, Europe has begun searching for alternative paths, albeit cautiously. In 2024, the "Wero" application was launched as a European digital wallet in Germany, France, and Belgium, in an attempt to build a local electronic payment network serving around 48 million people, with plans for full expansion by 2027.

However, this project, despite its symbolic nature, is still under construction, meaning reliance on Visa and MasterCard networks for card payment systems will continue in the near term.

The Digital Euro

This brings to light the more ambitious option of the "Digital Euro" project promoted by the European Central Bank as a strategic step to enhance monetary sovereignty and reduce reliance on foreign infrastructure. It is expected to be launched within two years, though the project faces technical and political challenges, in addition to internal divisions regarding its impact on commercial banks and financial privacy.

In this context, the CEO of the European Payments Initiative, Martina Weimert, warned of the continent's significant reliance on payment systems belonging to Visa and MasterCard, considering the absence of a cross-border European network as a clear sovereignty gap. She stated in an interview with the Financial Times that Europe has good local payment cards "but we have nothing cross-border," urging urgent action to enhance financial independence.

Until European alternatives are fully developed, Visa and MasterCard will continue to hold the reins of the European payment system. However, observers note that the issue has transcended mere commercial competition and has transformed into a battle for sovereignty in an era where payment networks are turning into tools of geopolitical influence, where controlling the flow of money becomes a new face of global economic power.