Wero, UPI, Pix: Every major economy is building its own payment systems – yet Visa reports record profits

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From Brazil to India to Europe: Nearly every major economy is currently building its own digital payment system designed to render Visa and Mastercard obsolete. These systems work. User numbers are exploding. And yet both card giants continue reporting record profits. What sounds like a contradiction is in fact a masterclass in digital power politics – one that directly affects SMEs.

The global revolt against the card cartel

It’s happening quietly – but simultaneously everywhere: Governments and central banks worldwide are building payment systems designed to push two U.S. corporations out of the center of financial flows. In the UK, bank executives are now planning “Delivery Co”, a national alternative to Visa and Mastercard. Europe’s banking consortium EPI has already registered 47 million users for Wero. Brazil’s Pix became the country’s dominant payment method just five years after launch. And in India, UPI has effectively rendered traditional banking invisible.

Motivations are strikingly similar across borders: sovereignty over domestic payment infrastructure, lower transaction costs, and independence from companies that could – under real-world geopolitical pressure – cut off the financial tap. Russia’s 2014 experience, when Visa and Mastercard disconnected the country following sanctions and forced Moscow to build its own MIR card system, served as a global wake-up call.

Three models, one direction

The most successful alternatives share a common principle: They layer a user-friendly interface atop existing banking infrastructure – not replace it. Differences lie in implementation details.

India – UPI (since 2016): The Unified Payments Interface was developed by India’s state-owned National Payments Corporation of India (NPCI) as an open standard. Any bank can join; any app can integrate UPI. Payments happen via a simple ID – similar to an email address – or via QR code. Google Pay in India today functions primarily as a UPI app, not a card app. The system now processes billions of transactions per month – and is free for consumers.

Brazil – Pix (since 2020): Brazil’s central bank mandated Pix as a compulsory system: Every financial institution with more than 500,000 active accounts must participate. Transactions are free for individuals; for businesses, fees sit well below 1% – compared to 1-2% for credit cards. Within five years, Pix became Brazil’s dominant payment method.

China – Alipay and WeChat Pay: China pioneered mobile payments – but also serves as a cautionary tale. Both platforms are private, not open standards. For years, Alipay users couldn’t send money to WeChat Pay users. Only after regulatory intervention did the systems begin opening up. To the rest of the world, China became both blueprint and warning: Mobile payments work – but only if governments set the rules.

“Dependence on two U.S. corporations for something as fundamental as payments was never acceptable to many economies – they simply lacked an alternative. Now they have one.”
– MBF Editorial Team

Europe’s complicated path: Wero and the digital euro

Europe faces greater hurdles than India or Brazil – for two reasons. First: Credit and debit cards are already deeply entrenched here. There’s no vacuum for a new system to fill. Second: Europe isn’t a single nation but a continent with over 20 distinct regulatory frameworks, multiple central banks, and pre-existing national systems – including iDEAL in the Netherlands, Vipps in Scandinavia, and Blik in Poland.

Yet progress is underway. The European Payment Initiative (EPI) – a consortium of 16 major European banks, including Deutsche Bank, BNP Paribas, and ING – has launched Wero, a platform built on the SEPA Instant standard. The concept is familiar: pay via phone number, email address, or QR code – in real time, at no cost to users. Wero is already live in Belgium, France, and Germany; some 50 of 106 enrolled banks have activated the service.

In parallel, the European Central Bank (ECB) is developing the digital euro – a central bank digital currency (CBDC) that would allow citizens to hold accounts directly with the ECB. That would be far more radical than Wero, potentially rendering parts of the traditional commercial banking system obsolete. Precisely because of that threat, banks are pushing Wero aggressively – to get ahead of the ECB.

Wero’s next major milestone: interoperability with 13 national payment systems across Europe. If achieved, the platform would gain access to well over 100 million additional users. Whether merchants and consumers actually switch remains an open question.

The paradox: Why Visa and Mastercard keep growing anyway

Here’s where things get interesting – and highly relevant for SMEs. Despite all these new competitors, both card giants continue reporting record results. Mastercard’s international business recently grew at ~13% annually – significantly faster than its U.S. business (~6%). That’s the exact opposite of what one might expect.

Four factors explain this paradox:

1. The overall market is expanding faster than competitors can capture share. While UPI and Pix dominate emerging markets, the total volume of digital payments is surging globally – so Visa and Mastercard still process more transactions year-on-year.

2. Cross-border payments are their moat. When a German SME purchases from a U.S. platform – or a Korean customer pays for a Netflix subscription – that transaction almost always runs through Visa or Mastercard. National systems like UPI or Pix excel domestically – but remain unprepared for cross-border flows.

3. Rising per-transaction fees. Over years, both firms have systematically expanded and increased their fee structures – prompting successful lawsuits from merchant associations. Today, more is extracted per transaction than five years ago.

4. Services beyond the card. Visa and Mastercard are long past being mere card networks. They offer anti-money laundering checks, fraud prevention, tokenization, dispute resolution, and foreign exchange settlement – services ironically used by institutions operating Pix, Wero, and UPI – and paid for accordingly.

“As long as national payment systems end at national borders, Visa and Mastercard’s moat remains intact. The question isn’t whether, but how quickly, Wero, UPI, and Pix go international.”
– MBF Editorial Team

What this means for SMEs

German companies face three concrete action areas:

Monitor Wero – don’t ignore it. SEPA Instant has been mandatory for all banks in the Eurozone since 2025. Wero builds directly on that standard. If you run an online shop in the DACH region, check whether your payment provider already supports Wero – or when it plans to. Transaction costs are significantly lower than those for credit card payments.

Know your cross-border costs. If you sell or buy internationally, every Visa or Mastercard transaction incurs fees that have risen in recent years. Whether cheaper alternatives will emerge – such as via Wero’s planned interoperability with Scandinavian or Polish systems – depends entirely on how fast integration advances.

Treat payment sovereignty as a risk factor. Russia’s experience – and cases where Visa and Mastercard blocked payments for political or regulatory reasons – shows clearly: Relying exclusively on two U.S. firms for all payment processing creates a single-point-of-failure risk. Diversifying payment infrastructure isn’t just for multinationals.

Conclusion: Revolution in slow motion

The world is quietly assembling a decentralized network of national payment systems – destined to erode Visa and Mastercard’s dominance over the long term. Paradoxically, in the short term, the card giants benefit: More digital payments globally mean more transactions – and in cross-border commerce, they retain a de facto monopoly.

For SMEs, this means: Cards won’t vanish tomorrow. But if your payment strategy revolves only around Visa and Mastercard today, you’re building on a foundation that will look markedly different five years from now.

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Header Image Source: Pexels / Tim Douglas (px:6205512)