The Guardian view on Europe’s payments problem: sovereignty starts at the till | Editorial

When the centre-left French politician Aurore Lalucq posted a warning last Wednesday that Donald Trump could cut off Europe from international payment systems, the clip went viral. To many, her message made sense. After all, if Mr Trump was prepared to test allies’ boundaries over Greenland, it is not far-fetched to imagine Visa and Mastercard becoming used against a recalcitrant Europe.

The US can turn off payment systems it controls. Russia learned this first-hand after sanctions were rightly applied for its invasion of Ukraine. As up to 60% of Russian retail transactions depended on Visa and Mastercard for authorisation, the ban left many ordinary people stranded without access to funds and unable to buy goods. Under Mr Trump, America’s goal is to “help Europe correct its current trajectory”. Given such talk, Ms Lalucq, who chairs the European parliament’s economic and monetary affairs committee, is not wrong in calling for an “Airbus of European payments” to protect the EU.

If the European Commission president, Ursula von der Leyen, is serious about the bloc’s “independence”, then during her visit to India this week she might ask New Delhi for advice. Within a decade, India has built a digital public infrastructure designed to reduce reliance on foreign-controlled payment networks and insulate its domestic payments from external pressure or sanctions.

India’s Unified Payments Interface (UPI) could be the answer Ms Lalucq is looking for: a state‑backed, universal payment system. The plumbing does not need Visa or Mastercard to be involved. UPI has near‑zero fees. It is not a wallet but a public standard: banks, fintechs and apps compete on top of it. Card networks never took deep root in India. But UPI has meant the country has leapfrogged straight to mobile app “e-cash” – with shoppers using QR codes for everyday payments.

The biggest players are US companies – Google Pay and Walmart’s PhonePe account for 80% of transactions – but they don’t control UPI. India now processes billions of transactions a month, with instant settlement between shoppers’ bank accounts and merchants’. UPI made digital payments ubiquitous among poor households. Meanwhile, credit cards’ market share in India’s digital payments fell to 21% in 2024 from 43% in 2018.

Creating a European UPI would not be easy. The EU is institutionally complex. Banks would resist change. Companies such as Stripe already provide cross-border wiring. But this is about state and bloc autonomy. Ms Lalucq’s curt dismissal of Wero – Europe’s bank-led payments wallet – makes sense as it is a private sector product, not public infrastructure. India’s experience raised civil liberty questions. It could be argued that Europe has a mature privacy framework to address them.

Would-be world powers aren’t waiting. China’s payment ecosystem has been built to be governed domestically. India shows that this was not a one‑off. Both want to export their models. India’s UPI is built as an open, decentralised public standard. China’s Digital Silk Road, by contrast, locks partners into Beijing’s technology and authoritarian governance. A European payments system that bolsters the continent’s sovereignty is a good idea. Ms Lalucq ought to be thanked for raising it. For the EU to look to India for answers would also be a practical expression of the call by Mark Carney, the Canadian prime minister, for deeper ties between middle powers. Strategic autonomy may begin not with grand strategy, but with how we shop.