Can the UK Build a Domestic Alternative to Visa and Mastercard?

March 2026

Fintech & Payments

Shane O'Sullivan

Research Analyst

In February, senior banking leaders and payment providers convened for an industry meeting on payment sovereignty, chaired by the chief executive of Barclays UK. The group discussed the creation of DeliveryCo, a proposed funding and governance vehicle intended to support the development of a domestic card scheme.

Behind the initiative is a growing concern about concentration in the UK’s card ecosystem. Today, roughly 95% of card transactions run through foreign-owned networks. For some in the banking sector, that level of dependence raises strategic and resilience questions. These concerns have been sharpened by geopolitical uncertainty and ongoing debates around the control of critical financial infrastructure.

Sovereignty vs Complexity

Responses from across the payments industry reflect a mixture of optimism and caution. A domestic payment rail could enhance resilience against systemic shocks, whether operational, geopolitical, or cyber-related, by providing an alternative if global networks face disruption.

A recent precedent illustrates this risk. When both Visa and Mastercard suspended operations in Russia following the country’s invasion of Ukraine, domestic transactions continued through Mir, Russia’s national card scheme established in 2014.

However, others view the effort more cautiously. Payments experts argue that sovereignty is not simply about creating a “British Visa”. It also depends on interoperability, governance, and transparency across the rails that underpin commerce. Elements of the UK’s existing payments ecosystem, including Open Banking and real-time settlement infrastructure, already provide significant sovereign control if governed and scaled effectively.

Notably, both Visa and Mastercard are part of the new funders group, alongside major financial institutions including Santander UK, NatWest, Nationwide, Lloyds Banking Group and Coventry Building Society. Their involvement suggests the proposal is not being built purely in opposition to the global networks, but with participation from across the ecosystem.

Consumer & Commercial Impacts

For merchants and fintechs, the prospect of a domestic alternative presents both opportunities and uncertainty. Greater competition in card processing could reduce merchant fees and diversify payment infrastructure. At the same time, payment service providers would need to invest in integrating another system into existing checkout environments.

From a consumer perspective, any visible changes are likely to be several years away, with some banks suggesting a timeline of around five years.

As new cards and infrastructure are gradually introduced, the transition would need to preserve the familiarity of everyday payment experiences. Consumer adoption will ultimately depend on trust and convenience, particularly in a market where Visa and Mastercard are already deeply embedded across digital wallets and checkout flows.

The UK’s discussions also reflect a wider international shift towards payments autonomy. Across Europe and emerging markets, policymakers and industry groups are considering how to balance the efficiency of global networks with greater control over critical financial infrastructure.

Some regions have introduced national schemes, while others are experimenting with regional initiatives or digital currencies. One example is Wero, the pan-European digital wallet and payment scheme built on account-to-account infrastructure. Initiatives such as this illustrate Europe’s broader effort to reduce reliance on US-based card networks.

How Visa and Mastercard Could React

Global card networks are unlikely to remain passive in the face of credible domestic competition. Visa and Mastercard have both emphasised their commitment to the UK market and have publicly welcomed competition. Visa has stated that it “welcomes the industry progress on account-to-account payments in the UK.”

Any coordinated response would likely begin with commercial strategy. Targeted reductions in scheme or assessment fees for UK issuers and acquirers could ease political pressure while reinforcing the economic case for remaining on existing rails.

At the same time, both networks could increase visible investment in UK infrastructure. Expanding local processing capabilities, strengthening fraud prevention tools, and enhancing operational resilience would demonstrate continued commitment to the market.

Looking Forward

The industry response to proposals for a UK-backed domestic card network reflects a balance between strategic ambition and operational realism. There is broad agreement on the importance of improving infrastructure resilience and reducing concentration risk. However, introducing a new scheme into a mature and globally integrated card ecosystem presents significant commercial, technical and regulatory challenges.

Any successful initiative will depend not only on governance and funding structures, but also on achieving widespread issuer, acquirer and merchant adoption without disrupting existing payment flows. How policymakers and industry leaders manage this balance between sovereignty, competition and practicality will shape the next phase of the UK’s payments landscape.

Shane is a Research Analyst at Juniper Research, specialising in fintech trends, market forecasting and competitive analysis. He contributes to in-depth reports and strategic insights across digital banking, payments and financial inclusion. His work supports clients navigate emerging opportunities and regulatory challenges in the evolving fintech landscape.