UK bank bosses plan to set up Visa and Mastercard alternative amid Trump fears | Financial sector

British bank bosses will hold their first meeting to establish a domestic alternative to Visa and Mastercard, amid growing fears over Donald Trump’s ability to disable US payment systems.

The meeting, chaired by Barclays UK chief executive Vim Maru, will take place this Thursday and will bring together a group of City backers who will underwrite the costs of a new payments company to keep the UK economy going if problems arise.

The city-funded, but government-backed, initiative has been under discussion for years. However, Trump’s recent threats against NATO allies over Greenland have amplified fears that an over-reliance on US companies could put the UK’s payments – and the economy as a whole – at risk.

Around 95% of card transactions in the UK are made using payment systems owned by Mastercard and Visa, according to a 2025 report from the UK’s Payment Systems Regulator. This dominance has become much more relevant as cash use continues to decline across the country.

“If Mastercard and Visa were turned off, it would send us back to the 1950s,” before cards dominated the British economy and businesses relied entirely on cash, an executive familiar with the project told the Guardian. “Of course we need a sovereign payment system.”

The potential disruptions could be significant. In Russia, where businesses rely on Visa and Mastercard for 60% of their payments, U.S. sanctions that forced companies to turn off their services have left ordinary people stranded, without access to funds and unable to buy goods.

Similar concerns are being raised in the EU, where politicians have taken a strong stance in favor of building local networks that could not be turned off on a whim by foreign powers. The chair of the European Parliament’s Economic and Monetary Affairs Committee, Aurore Lalucq, issued a stark warning that went viral last month about reliance on American companies for such an essential service.

“Visa, Mastercard… the urgent problem is our payment system. Trump can cut everything,” Lalucq said. “The rest is poetry. I urgently ask the Commission to organize a European Airbus of payment systems: we cannot say that we were not warned.”

However, the UK is taking a less aggressive stance, with Visa and Mastercard working under the initiative.

Both companies are part of the new funders group, giving them a stake and a say alongside a host of banks and payments companies, including Santander UK, NatWest, Nationwide, Lloyds Banking Group, network body ATM Link and Coventry Building Society.

Although British officials stressed the need for reinforcements, they stopped short of denouncing American threats as the source of their nervousness.

Bank of England Deputy Governor Sarah Breeden also said in a recent speech: “Against the backdrop of a challenging and changing cyber and operational risk environment, this could provide an additional degree of resilience in the UK payments landscape, as an additional payments rail in the rare occasion of operational disruption to existing rails. »

Joe Garner, the former chief executive of Nationwide who worked as a government adviser on Rachel Reeves’ national payments vision and who led an independent review into payments in 2023, told the Guardian: “Regardless of any political developments, the UK has to do it. We had to do it before, we have to do it now… I don’t think that has changed with recent events.”

City backers will be responsible for creating the legal structure, leadership plans and future financing models for the new payment alternative, known as DeliveryCo. The Bank, for its part, will develop infrastructure plans which will be handed over to the group next year.

It is understood that the new payment system will likely be in place by 2030.

Mastercard and Visa have said they are committed to the UK and welcome competition.

Visa said this included providing consumers and businesses “access to innovative and secure digital payments with the highest levels of resilience and reliability. We welcome the industry’s progress in account-to-account payments in the UK. We believe competition across multiple solutions, supported by a level playing field, will bring choice, innovation and economic growth to the UK.”

Mastercard said: “Mastercard has been fully invested in the UK for decades, providing consumers and businesses with a wide range of convenient, simple and secure ways to pay and get paid. We remain committed to driving commerce here at home and around the world by helping businesses of all sizes grow and meet the needs of their customers.”

Trade association UK Finance, which provides administrative support to the DeliveryCo project, declined to comment.

The Treasury has been contacted for comment. The Bank of England declined to comment.