UK Banks Explore National Payment System Alternative

In response to growing concerns about reliance on US-owned payment systems, UK bank leaders are set to hold their inaugural meeting this Thursday. The focus will be on establishing a national alternative to Visa and Mastercard, particularly in light of political tensions surrounding US policies.

Meeting Overview

The meeting, led by Vim Maru, the UK chief executive of Barclays, will gather a coalition of City funders who are poised to finance the new payments venture. This initiative aims to safeguard the UK economy against potential disruptions that could stem from the actions of foreign powers.

The Impetus for Change

This City-funded, government-supported project has been in the planning stages for several years. Recent threats from former US President Donald Trump regarding NATO allies have heightened fears that dependence on American companies could jeopardize UK payment systems and, by extension, the economy.

Current Payment Landscape

Approximately 95% of card transactions in the UK are conducted through Mastercard and Visa, according to a 2025 report from the UK’s Payment Systems Regulator. As cash usage declines across the country, this reliance on a few key players has become increasingly problematic.

Voices of Concern

An expert involved in the initiative explained, “If Mastercard and Visa were turned off, it would send us back to a cash-only economy reminiscent of the 1950s. A sovereign payments system is essential.” Similar sentiments have also emerged in the EU, where policymakers express the urgent need for local payment networks that cannot be easily disabled by international forces.

Collaboration with Existing Giants

Interestingly, despite the push for independence, both Visa and Mastercard are participating in the funding initiative. They will join other financial institutions including Santander UK, NatWest, and Lloyds Banking Group, playing a role in shaping the new payment framework.

The Road Ahead

While UK officials acknowledge the necessity of a contingency plan, they have refrained from directly attributing their concerns to US threats. Bank of England Deputy Governor Sarah Breeden emphasized the importance of resilience within the UK payments landscape, indicating that a new system could mitigate risks during potential disruptions.

Timeline and Commitment

The development team, known as DeliveryCo, will be responsible for establishing the legal framework and funding models for this new payments alternative. The goal is to have the system operational by 2030. Both Mastercard and Visa have expressed their commitment to the UK market, welcoming increased competition that could lead to more innovative payment solutions.

In conclusion, as the UK navigates a changing economic landscape, the establishment of a national alternative to Visa and Mastercard may soon become a pivotal chapter in ensuring financial independence and stability.