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French payments network CB is seeking to lead a fightback against US giants Visa and Mastercard, amid concerns by European officials that the groups’ dominance could be weaponised against the bloc.
The network’s head Philippe Laulanie said CB had started to reverse a years-long decline that had cut its share of payments in France from more than 90 per cent five years ago to 75 per cent, according to the company’s own figures.
Laulanie said CB, which operates on a “co-badging” system that allows French bank cards to run both on international and local networks, had about 30 candidates to join its network.
“CB has become very attractive again,” Laulanie said, after Russia’s invasion of Ukraine highlighted issues around “strategic dependencies” and the need for sovereignty over payment systems.
“Current tensions with the US under Donald Trump have underscored the idea that some services could be cut off or subject to conditions,” he added.
CB was set up in the 1980s with the backing of France’s biggest banks to mutualise some of their costs, and operates as a non-profit association.
But it lost market share as US rivals dangled exclusivity deals that encouraged banks to drop the co-badging system, and lured fintechs with incentives that allowed them to give users free cards.
French President Emmanuel Macron has thrown his weight behind CB’s co-badging initiative, describing the French payments network as the “last kilometre of our economic sovereignty”.
There is no cross-border card scheme in the bloc that serves as an alternative to Visa or Mastercard, although there is now a European rival to Apple Pay called Wero, which is expanding.
Macron, who has made France one of the biggest advocates for Europe to decouple from the US on everything from weapons systems to technology, called on “all the financial actors in the national and European payments space” to adopt a dual model combining Visa and Mastercard with a domestic payments alternative.
Foreign banks such as JPMorgan Chase have joined the network in recent years, as their presence in France has grown, in large part because CB’s fees are lower for local businesses like restaurants.
“Unfortunately, many European countries abandoned their domestic networks and it’s going to be a harder path for them,” Laulanie said.
But the recent co-badging campaign has irked some online banks that have chosen not to work with CB to date, according to people from two fintechs operating in France. The French network was slow to adapt to the era of mobile payments, and has only recently become compatible with phone payments.
London-headquartered fintech Revolut, French online bank Qonto, BNP Paribas-owned fintech Nickel, and BoursoBank, Société Générale’s rapidly growing online bank, are among those that use just Visa and Mastercard.
Guillaume Petipas, a payments specialist at KPMG, said using just one network was logical for start-ups in expansion mode, which might not want to juggle schemes in different countries until they were more established.
