Real-Time payments threaten legacy card economics

By Vriti Gothi

Governments across major economies are reassessing their dependence on global card networks as real-time payment infrastructure gains traction, reshaping the competitive dynamics of the payments sector.

The debate centres on monetary sovereignty and control over domestic payment rails, as policymakers explore alternatives to legacy card-based systems dominated by international schemes such as Visa and Mastercard.

In the UK and parts of Europe, real-time bank-to-bank payments enabled by Open Banking frameworks are increasingly positioned as a viable alternative to traditional card schemes. These systems allow consumers to pay directly from their bank accounts, bypassing intermediary networks and reducing settlement friction.

The strategic opportunity for the UK and Europe, according to Neal, lies not merely in reducing reliance on international networks but in redesigning payments infrastructure around mobile-first experiences and artificial intelligence capabilities. Such systems could potentially deliver faster settlement, lower transaction costs, and improved user authentication, aligning more closely with evolving consumer behaviour.

Emerging markets provide a working model of this transition. In Brazil, the central bank-backed instant payments platform Pix has achieved widespread adoption across retail commerce. Similarly, India’s Unified Payments Interface (UPI) has become a dominant payment method, handling billions of monthly transactions and significantly reducing reliance on cards for everyday purchases.

Stuart Neal, CEO of Boku, said, “We’re seeing a clear global trend: governments have realised you can’t be a future-proof economy if you don’t control your own payment rails. This isn’t just about fees or Big Tech it goes to the heart of monetary sovereignty.  In the UK, that shift has already begun. Whilst Visa and Mastercard still run on 50‑year‑old technology, with all the inherent limitations that brings, Real-time payments technology (Open Banking) has now enabled consumers to pay straight from their bank accounts. This represents a major opportunity for the UK and Europe to embrace new technology to do the ‘card scheme’ job better – mobile‑first, AI-enabled and aligned to how people actually want to pay. If we do this well, we won’t just be less reliant on existing card networks we’ll have built something genuinely better for governments, merchants and most importantly consumers.

Real-time payment technology is already proven at scale in emerging markets, with PIX in Brazil and UPI in India for example, where similar local payment methods are being used for the majority of everyday commerce – entirely by-passing traditional card schemes.”

These systems demonstrate that real-time payment rails can operate at national scale, supporting high transaction volumes while fostering domestic FinTech ecosystems.

For the FinTech sector, the implications are significant. Real-time payment rails could open new revenue models for payment service providers, reduce interchange-driven economics, and intensify competition between card schemes and account-to-account providers. At the same time, regulatory frameworks and infrastructure investments will play a decisive role in determining whether Europe and the UK can replicate the scale achieved in markets such as Brazil and India.

As governments increasingly frame payments infrastructure as a strategic national asset, the balance of power within the global payments ecosystem may be poised for structural change.