Cards vs pay-by-bank: ACI’s Dean Wallace on why habit and convenience, not disruption, decides who dominates the checkout

Every few years the industry writes the card’s obituary. Account-to-account payments are faster and often cheaper for merchants, the argument goes, so consumers will surely abandon cards for a direct bank transfer. Then they reach into a pocket, pull out a card (or their mobile) and tap. The prediction keeps arriving. But the behavior doesn’t change.

Dean Wallace has a one-word explanation for that, and he has earned the right to it. He was recruit number one into the team that built one of the UK’s first pay-by-bank propositions, and he has spent the years since moving between the card world and the account-to-account world, most recently as director of consumer payments modernization at ACI Worldwide. Ahead of the panel he moderates at Payments Unleashed EMEA, his message to anyone betting on the card’s demise is blunt. The thing the market underestimates is not technology. As he puts it, “habit and convenience rules.”

Start with the scale of the thing, because it is easy to underestimate. Cards, physical and mobile, accounted for 64 percent of all UK payments in 2024, the year cash finally slipped below 10 percent for the first time, according to UK Finance, and 57 percent of adults are now registered for at least one mobile payment service, which almost always means a card sitting behind the glass. Open banking is growing quickly, with around 33 million UK payments in a single month late in 2025, up by half on the year. But that still sits well below the many billions of card payments across a year. New rails can climb fast and stay a long way from daily muscle memory.

Cards replaced cash and cheque for one reason, Wallace says: convenience. The motion is almost automatic, a dip into the pocket, choose the card, tap, put it away. Mobile wallets layered a digital habit on top, which is why Apple Pay and Google Pay caught on, but the friction is much the same: unlock, prime the biometric, choose the card, tap, put the phone away. In the online world it’s even more straightforward: use the mobile wallet, or get your browser to auto-populate the payment details, click “buy” and you’re done. The appeal of having many cards in one wallet (leather or digital) lands with some people and not others. So the real question, he argues, is not whether pay-by-bank is technically better. It is what the leaders in that space are doing to build a new habit.

Some have managed it. In Spain, Bizum has become a verb, with more than thirty million users, close to sixty percent of the population, sending money straight from their banking apps with nothing more than a phone number, now more than three million times a day, and across more than a hundred thousand merchants. Across Belgium, France and Germany, the bank-backed Wero has signed up more than 47 million users as Europe pushes for a home-grown alternative to the global card networks, though it remains a small share of European spending. What both have in common is not clever rails. It is that they made the new way feel automatic.

The cautionary tale sits closer to home. PayM, the UK’s mobile-number payment service, launched in 2014 with the backing of fifteen banks and reach into more than nine in ten current accounts. It still closed in 2023, with fewer than six million registered users and a long slide in usage behind it. The infrastructure was everywhere, but the customer experience was disjointed across the issuing banks. The habit never formed. For Wallace, who watched that era at close range, the lesson is that reach does not equal adoption.

Win what Wallace calls the “payment moment of truth” and the competition shifts to customer experience, where a small nudge in one direction means runaway success and a small stumble in the other is a quiet abandonment. Two questions decide most of it.

The first is what happens when something goes wrong. Cards have long held this ground because their dispute and chargeback rules are so well understood. But that lead is narrowing. India’s UPI, the example Wallace reaches for, shows account-to-account can run at enormous scale, and in the UK, Amazon’s move to open-banking Pay by Bank, launched at the start of 2026, made the refund close to instant and routed it straight back to the bank account, with Amazon’s own guarantee and statutory protections layered on top. It narrows the experience gap without erasing the protection gap: pay-by-bank still does not carry the credit-card chargeback and Section 75 rights that cards have trained consumers to expect. The refund got faster. The safety net is not yet the same.

The second is how ready the instrument is to use. Cards look exposed here, given the three-to-five-day wait for plastic in the post, but modern issuing digitises the card into a phone wallet instantly, so the back foot disappears. Pay-by-bank starts out ahead because it already lives in the banking app, yet it carries its own catch: the account has to be enabled in the first place, and with the rise of “pots” and sub-accounts, people often are forced to leave pay-by-bank switched on only for their main account where support exists, leaving pots to be used only with their attached cards, making true ubiquity harder.

Two more factors keep cards in the fight. Loyalty is the first, and it is far louder on the American side of the Atlantic, where cards buy lounge access and free holidays, than in Europe, where capped interchange has thinned the economics that fund those rewards. Even so, Wallace notes, a card co-badged with a supermarket or an airline still has room to play, and it is hard to see how pay-by-bank economics support the same kind of rewards without interchange revenue, especially when free non-bank loyalty services already do cashback perfectly well.

Acceptance is the second, and he calls it “the king or queen of all the convenience factors,” because a payment instrument you cannot actually use is no use at all. Cards dominate across form factors, the physical terminal, online, in-app, recurring billing, right down to the edge case of buying an ice cream in a cave. Pay-by-bank slides easily into person-to-person use, the UK’s PayM experience aside, but beyond that it still leans noticeably toward digital channels. That may be about to shift. With Apple compelled to open access to the iPhone’s NFC, under a binding commitment to European regulators that took effect in 2024, the obvious question is how long before a bank account itself sits in the phone wallet, and whether the industry will accept a pass-through authentication from wallet to banking app.

Wallace lands somewhere more interesting than replacement. Having made the move from cards into account-to-account himself, and having studied the markets actually making the switch, his conclusion is that cards are not going away. They are getting smarter, picking up tokenized credentials and riding the same digital rails as everything else. The future he describes is multi-rail, where different methods win different jobs, based on the type of convenience the consumer is seeking. Convenience, trust and habit are the three pillars of consumer payments. For the merchant it is conversion, cost and how easily a method integrates and is supported.

Dean Wallace moderates Banking Breakout 2, Defending the card: strategy in the age of pay-by-bank, at Payments Unleashed EMEA. The event opens with an evening reception on 29 June at 12th Knot, Sea Containers, and continues with a full day of content on 30 June at the Hilton London Bankside, bringing senior payments leaders from across EMEA together for sessions on real-time payments, card and account-to-account strategy, fraud and scam liability, and the operating-model changes behind always-on banking.

No rail wins the checkout outright. The winner, as Wallace sees it, is whoever turns the better experience into a habit, and on current form that is a contest cards are very much still in.