paydirekt is a mobile and online payments initiative of Germany’s largest banks, including Deutsche Bank, Commerzbank, comdirect, Sparkassen Finance Group, and Postbank.
Launched in 2015, paydirekt was designed as a way for online shoppers to pay directly from their bank account. Later in 2021, payment platforms paydirekt, Giropay, and Kwitt merged under Giropay. The goal of the merger was to create a uniform payment brand and to optimise payment methods for customers and retailers alike. Following the merger, paydirekt became one of PayPal’s biggest domestic competitors in Germany.
With the rise of EPI, the banks have reportedly decided to abandon paydirek/Giropay in favour of supporting the new solution. According to previous reports, the decision was made in light of paydirekt/Giropay’s less-than-ideal acceptance rate. By comparison, PayPal has reportedly grown its market share in Germany and currently has around 35 million active customer accounts. According to Statista, PayPal’s popularity in the country is surging for ecommerce websites, with around 35% of all German domains featuring a PayPal plug-in.
The German banks’ decision to shut down paydirekt/Giropay comes right before the launch of wero, EPI’s digital wallet solution set to go live in mid-2024.
EPI, or the European Payments Initiative, was launched by 16 banks and financial service companies to create a new digital wallet (wero) and a unified account-to-account (A2A) solution. EPI’s new offering is expected to become a new standard in payments for both European consumers and merchants across in-store, online, and person-to-person retail transactions.
wero, the digital wallet that EPI is gearing up to launch, is a payment solution that leverages the instant payment scheme defined by the European Payments Council (EPC). In the initial phase, EPI will launch wero in Belgium, France, and Germany, followed by the Netherlands, with plans to expand to additional countries in the future.
The launch of wero is in line with the general push towards instant payments across Europe. This further aligns with calls from European authorities that encouraged banks and payment providers to develop an independent, alternative payment system that uses instant payment schemes.
For merchants, this initiative is expected to translate into access to a unified payment solution that is accessible to all European consumers. Similarly, for consumers, the solution is anticipated to advance the switch to digital payments.
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