Account-to-account payments at the point of sale have been discussed as a card-replacement technology for most of the last decade. The infrastructure conditions that make meaningful adoption possible have only recently been met: mandatory instant payment rails across the eurozone, open banking APIs that can initiate payment directly from a consumer's banking app, and scheme-level interoperability frameworks that reduce the fragmentation problem. The question worth asking now is not whether A2A payments will grow — they will — but where in the merchant stack they actually improve the economics, and where the card rail remains the better commercial choice.
What the Infrastructure Looks Like Now
SEPA Instant is the backbone. The EU Instant Payments Regulation mandated receive capability for all eurozone payment service providers from January 2025 and send capability from October 2025. This creates a universal rail — any consumer with a eurozone bank account can receive and send instant payments, which is the necessary condition for pay-by-bank at checkout to work at scale.
The open banking access layer sits on top. PSD2 mandated open banking APIs across the EU; the forthcoming PSR tightens the performance and anti-obstruction requirements significantly. Third-party payment initiation services (PISP licences) allow fintechs and payment providers to initiate payments directly from a consumer's account with a single authentication — no card number, no CVV, no scheme routing.
In the UK, the picture is similar but distinct: Faster Payments provides the rail, and Open Banking Limited has built the interoperability framework. Variable Recurring Payments — which allow A2A payments to be initiated for recurring amounts without per-transaction consumer authentication — are live for limited use cases and expanding. The FCA and PSR are developing the commercial model for VRPs at broader scale, including the merchant-facing fee structure that has been the main commercial sticking point.
Where the Economics Work for Merchants
The primary commercial case for A2A at checkout is interchange avoidance. Card interchange in the EU is capped at 0.2% for consumer debit and 0.3% for consumer credit, but the effective merchant discount rate includes acquirer margin and scheme fees on top, typically ranging from 0.5% to 1.8% for online transactions depending on card type, geography, and merchant category. An A2A payment routes around all of this — the consumer's bank and the merchant's bank communicate directly, and the fee is a fixed per-transaction amount rather than an ad valorem charge.
The merchants where this arithmetic is most compelling share three characteristics: high average transaction values (where ad valorem interchange is a significant absolute cost), low dispute rates (A2A payments are irrevocable — there is no chargeback mechanism), and consumer bases with high mobile banking adoption. Large-ticket B2B transactions, utility payments, insurance premiums, and rent payments fit this profile well. Fashion retail at £40 average basket fits it poorly.
Where Cards Remain the Better Option
Consumer protection under the card rails is meaningfully stronger than under A2A. Section 75 in the UK (for purchases over £100), card scheme dispute rights, and the fraud liability shift under 3DS collectively give consumers rights they do not have on A2A payments. For any merchant selling goods or services where chargebacks are a material risk — travel, digital goods, subscription services — the absence of a consumer dispute mechanism under A2A is a significant barrier to adoption. Consumers know this, even if they cannot articulate it explicitly, and conversion rates at checkout reflect it.
International transactions are also a current limitation. SEPA Instant works within the eurozone. Faster Payments works within the UK. Cross-border A2A payments — a UK consumer paying a French merchant — require either a correspondent banking arrangement or a scheme-level interoperability framework that does not yet exist at the scale needed for general acceptance. Cards work everywhere. A2A does not, yet.
The Acquirer's Position
For acquirers, A2A payments represent a strategic challenge and a distribution opportunity simultaneously. The challenge is obvious: if A2A displaces card volume, interchange-linked acquiring revenue falls. The opportunity is that acquirers with existing merchant relationships are well positioned to distribute A2A acceptance as an additional payment method — keeping the merchant relationship while adapting the revenue model from interchange participation to fixed-fee transaction processing.
The acquirers who will be most exposed are those whose margin model depends on card interchange and who have not invested in building or licensing A2A acceptance capability. The acquirers who will be best positioned are those who treat A2A as a product extension rather than a threat, and who can offer merchants a single integration covering card, A2A, and digital wallet acceptance with unified reporting and reconciliation.