In a significant shift within the digital payments landscape, German banks are set to discontinue their PayPal competitor, Paydirekt, and pivot towards supporting the European Payments Initiative (EPI). This move marks a strategic realignment as the banks prepare to back EPI’s upcoming digital wallet, Wero.
From Paydirekt to EPI: A Strategic Shift
Launched in 2015, Paydirekt, which later merged with Giropay, was a collaborative mobile and online payments initiative spearheaded by major German banks such as Commerzbank, Deutsche Bank, HypoVereinsbank, Postbank, and the Sparkassen finance group. Despite the initial promise, Paydirekt struggled to gain substantial traction in the predominantly cash-preferred German market.
Coordinated Decision at Shareholder Level
According to Finanz-szene, a decision to cease operations for both Paydirekt and Giropay is expected at a forthcoming shareholder meeting. A spokesperson confirmed, “There are currently coordinations at shareholder level on the future of Giropay and Paydirekt GmbH as an operating company.”
Enter Wero: The Pan-European Payment Solution
The timing of this decision aligns with the impending launch of Wero, the digital wallet of the EPI. Initially backed by 31 major Eurozone banks along with acquirers Worldline and Nets, the EPI aims to create a unified pan-European payment system. Wero will support instant peer-to-peer (P2P) and consumer-to-business payments, with plans to expand into online and mobile shopping payments, and eventually point-of-sale transactions.
Despite Commerzbank and DZ Bank withdrawing from the EPI, Deutsche Bank remains a committed shareholder. Wero’s initial deployment will target Belgium, France, and Germany, followed by the Netherlands.
Future Implications
With Wero set to launch, it is believed that maintaining Paydirekt would further fragment the market and hinder the uptake of a unified European payment system. The shift to Wero reflects a broader strategy to enhance digital financial services across Europe, leveraging the collaborative strength of multiple financial institutions.
Stay tuned with FinQfy for more updates on this evolving story and other significant developments in the financial technology sector.
