EU authorities agree to make it easier for non-bank payment firms to join core payment rails — what that means for banks and fintechs

A new push to open the rails — who signed up and why it matters

European financial authorities — led by the European Banking Authority (EBA), the European Central Bank (ECB), national central banks and national supervisory authorities — have signed a memorandum of understanding (MoU) designed to reduce the barriers that stop non-bank payment service providers (PSPs) from joining core payment systems. The move is meant to help fintechs, e-money firms and other non-bank players get direct access to clearing and settlement infrastructure rather than relying on bank sponsors.

For the payments industry, that is a practical change. If it works, customers could see a wider choice of providers that connect directly to real-time and large-value payment rails. For banks, it threatens a steady slice of revenue tied to sponsorship, transaction handling and account float. For investors, the MoU is a policy nudge that could shift volumes, fees and competitive positions across the payments stack over the next few years.

What the MoU actually promises — practical cooperation, shared data and a focus on access

The MoU is a framework for cooperation rather than a new law. Its stated aims are straightforward: identify access barriers, exchange information between supervisors and central banks, and coordinate practical steps so that non-bank PSPs can meet the requirements for participation in payment systems.

Specifically, signatories commit to share assessments and supervisory intelligence about applicants, work together on risk and operational expectations, and explore pilot approaches to testing non-bank access. The scope covers the full range of retail and wholesale rails used across the European Economic Area — from instant payment services to large-value settlement systems and the retail clearing networks that move everyday transfers.

Authorities also signal a commitment to proportionality. That means tailoring operational, liquidity and resilience expectations to the actual risk non-bank PSPs present, rather than forcing them to meet bank-style rules that may be costly and unnecessary. The MoU names concrete cooperation channels and intends to speed up decisions about eligibility and oversight, aiming to reduce the friction that has kept many non-banks dependent on sponsored arrangements.

Winners and losers on the rails — how competition, fees and revenues could shift

At a high level, the MoU strengthens the hand of non-bank PSPs. Firms that have built customer-facing payment products but depend on bank sponsors for access could move toward direct participation. That reduces their operational dependence and opens a path to cheaper, faster settlement — which in turn can power new product features and pricing pressure.

That is good news for scale fintechs and card processors. Firms like Adyen (ADYEN) and PayPal (PYPL) are better placed to monetise direct access quickly because they already handle large volumes and have mature risk and operations teams. Card networks such as Visa (V) and Mastercard (MA) should see continued volume growth, since easier access tends to boost transaction throughput across the system.

Banks that used sponsorship as a source of fee income face the clearest downside. Lower reliance on bank sponsors could mean lower account-holding and transaction-related revenues, and tighter margins on payment services. At the same time, processors and infrastructure providers that supply connectivity, fraud tools and settlement services could capture new revenue streams by offering turnkey solutions for non-banks that still prefer outsourced operations.

From MoU to reality — timing, coordination headaches and legal limits

Remember: an MoU is a roadmap, not a new rulebook. Turning cooperation into operational change will take time and runs into national differences. Each country has its own technical set-up, risk rules and eligibility criteria for settlement banks. Some central banks may need to adjust internal rules before non-banks can plug in directly.

Expect a phased timeline: in the short term, authorities will publish guidance and start information-sharing; pilots and test arrangements could roll out within months; wider operational access across the EEA will probably take a year or more. Key hurdles include aligning anti-money laundering checks, setting liquidity requirements that non-banks can meet without excessive cost, and ensuring operational resilience for real-time systems.

Signals investors should watch — what shows this actually changes market economics

Investors in the payments space should track a handful of clear indicators. First, look for published guidance or rule changes from national central banks that explicitly open participation criteria. Second, watch for pilot announcements that let non-banks connect to instant-payment or settlement systems. Third, monitor sponsorship counts — a decline in bank-sponsored arrangements would be an early sign of market shift.

In terms of winners and losers: larger, mature fintechs and processors that can operationally absorb direct access are the clearest potential winners. Adyen (ADYEN) and PayPal (PYPL) fit that profile and stand to gain from either lower costs or new product capabilities. Card networks Visa (V) and Mastercard (MA) should see rising volumes, but fee pressure at the edges could compress some economics over time. Incumbent banks face moderate downside to payments income unless they pivot to provide specialised services to new direct participants.

Overall, the MoU raises the probability of a more competitive payments market in Europe. That is a structural positive for firms that can scale operations and a risk for organisations that rely on legacy sponsorship models. For investors, the next 12–24 months will be about watching policy steps turn into pilots and then into measurable shifts in access and volumes.

Sources

• eba.europa.eu