In the current discussions about digital sovereignty, the payments domain is often overlooked. Pay by Bank not only represents a technical improvement to the critical infrastructure, but also contributes to control over the three pillars of digital sovereignty: data, rules and value.
It also reflects a broader shift towards infrastructure that is increasingly made in Europe, for Europe.
Across Europe, digital sovereignty has become a central theme. Governments and industry leaders are asking how Europe can maintain control over its digital infrastructure, data flows and economic value. Most discussions focus on cloud, data and AI. But there is another domain that is just as critical, yet often overlooked: payments.
Payments are not just a service layer. They are a fundamental part of the digital economy. Every transaction is not only a movement of money, but also an exchange of data and a moment when trust is established. This makes payments a form of critical infrastructure. Whoever controls payment flows ultimately has influence over data, economic activity and dependency structures.
For decades, Europe’s payment landscape has relied heavily on global card schemes. These systems are efficient and widely adopted, but they also introduce fundamental dependencies on non-European infrastructures. As digital sovereignty becomes more important, that dependency is increasingly being questioned.
A different approach
Pay by Bank offers a different approach. Instead of relying on global card networks, Pay by Bank uses direct connections to bank accounts, enabled by open banking and real-time payment infrastructure.
Payments are initiated directly from the consumer’s bank to the merchant, reducing the number of intermediaries and bringing transaction flows closer to the European financial system. This is not just a technical improvement; it is a shift in the balance of control, towards infrastructure that is built, governed and operated in Europe.
Control over data, rules and value
Digital sovereignty is not only about infrastructure, but also about control over data, rules and value. Pay by Bank contributes to all three.
Data flows are based on explicit user consent and operate within a regulated European framework. Governance is shaped by European regulations such as PSD2 and upcoming initiatives like PSD3 and FiDA, ensuring that rules are defined within Europe rather than by global platforms.
At the same time, value creation shifts. By reducing layers in the payment chain, more economic value can remain within the European ecosystem, creating new opportunities for European fintechs and strengthening local innovation.
In that sense, Pay by Bank contributes to a financial infrastructure that is increasingly made in Europe — not only in where it operates, but in how it is designed and governed.
Shared standards and interoperability
To understand this properly, Pay by Bank should not be seen as a standalone payment method, but as part of a broader ecosystem.
A single Pay by Bank transaction involves multiple parties: banks, payment providers, merchants, regulators and technology partners. It depends on shared standards, interoperability and trust between participants.
In that sense, it is a clear example of how data ecosystems function in practice – not controlled by a single player, but coordinated through shared rules and infrastructure.
The adoption challenge
However, building this kind of ecosystem is only part of the story. The real challenge is adoption. Even the most strategically important infrastructure will not contribute to digital sovereignty if it is not widely used.
Merchants need to see clear benefits in terms of cost, control and customer experience. Consumers need a payment experience that is simple, fast and trustworthy. Without that, Pay by Bank risks remaining a niche solution rather than becoming a structural alternative.
This is a familiar pattern in ecosystem development. Technology can be built, and regulation can create the right conditions. But real impact only emerges when organizations actively choose to use the system because it delivers value in practice. This is also where infrastructure providers play a crucial role.
The role of infrastructure providers
To make Pay by Bank work at scale, the underlying infrastructure must be reliable, secure and consistent across markets. At the same time, it must be easy for organizations to integrate, without having to deal with the complexity of connecting to multiple banks and complying with different regulatory requirements.
IBANXS operates at this intersection. By providing Pay by Bank infrastructure across Europe, IBANXS enables organizations to connect to European bank rails in a scalable and compliant way.
A concrete example of this is the migration of IBANXS infrastructure from global hyperscalers to Proserve, a Dutch Cloud provider. This move reflects a deliberate choice for greater control, transparency and alignment with European standards around data, security and sovereignty.
It is also part of a broader shift towards infrastructure that is consciously built and operated in Europe, reducing reliance on external dependencies and reinforcing a truly European technology stack.
Building block for European data ecosystems
Looking ahead, Pay by Bank can be seen as part of a broader shift towards European data ecosystems. In these ecosystems, data is shared based on common rules, participants retain control, and value is created collectively. Payments, identity and data are becoming increasingly interconnected, and Pay by Bank is one of the first large-scale use cases where this model becomes visible.
Digital sovereignty will not be achieved through isolated solutions. It requires systems that are used, trusted and sustained over time.
Pay by Bank is one of the building blocks of such a system – not because it replaces existing payment methods overnight, but because it gradually shifts control back towards European infrastructure, governance and value creation.
A shift towards systems that are not only used in Europe, but increasingly made in Europe.