European PayPal alternative for real-time transfers launched

The Wero online payment system was launched in July 2024, allowing transfers without IBAN and BIC. Is the service an alternative to US providers such as PayPal?

Wero is a new European online payment system developed by the European Payments Initiative (EPI) and launched at the beginning of July 2024. It allows transfers without IBAN and BIC.

If you want to use it, you need an account at a participating bank or savings bank. It is intended to offer an alternative to US payment services such as PayPal, Apple Pay and Google Pay. The most important questions and answers.

We should enable fast and uncomplicated money transfers between private individuals. To do this, users only need the recipient’s mobile phone number or email address and not the 22-digit IBAN, as is the case with normal account-to-account transfers. If you have set up a Wero profile, you can – similar to Paypal – send or receive money from other people with a Wero profile.

This is currently only possible for accounts at savings banks, Volks- und Raiffeisenbanken, PSD banks and Sparda banks. More is to follow.

In the long term, the Wero payment system is intended to develop into an independent European payment system. It is currently in competition with well-known American payment services such as Paypal, Visa, Mastercard and Apple Pay. So far, however, users can only participate if their bank offers the service.

In addition, transfers are initially only possible with accounts in Germany, France and Belgium. A separate app will follow. From 2025, further functions such as paying in online shops will be added. From 2026, users should also be able to pay with Wero in stationary stores.

In direct comparison to Paypal, with Wero the transfer takes place directly from account to account, while with Paypal the money transfer takes place within the Paypal app. With Paypal you can manage any amount of credit and send money, regardless of your account. With Wero you do not have to register separately; you are already registered via your bank account. In order to use Paypal, you must create your own customer account and link it to your checking account and credit cards.

The European Payments Initiative (EPI) highlights Wero’s high level of data protection and its currently free use. However, the limited availability due to the small number of banks participating in the payment system and the limited range of functions compared to established providers speak against rapid spread. Paypal and other providers are active worldwide and have several million active customers.

Whether someone can establish themselves as a real alternative to Paypal depends on its recent popularity and acceptance among banks, merchants and users. Success is largely measured by whether it is possible to attract a critical mass of users and participating institutes.