Europe’s payments market is being quietly but fundamentally restructured. For Nikogiannis Karantzis, CEO of ISX Financial, this signals the maturation of the Electronic Money Institution (EMI) model.
Here, he explores how regulatory reform, infrastructure ownership and real-time settlement are converging to redraw the boundaries between banks and non-banks.
With reports suggesting that some 600 EMIs are now operating across the EU and the UK, scale and survival are no longer guaranteed. In such a congested field, what sets you apart?
The EMI market has undoubtedly reached a point where scale, infrastructure and resilience matter more than ever. Many EMIs entered the market with narrow propositions, mostly focused on a single product or geography. That model struggles, as regulatory complexity increases and customers demand broader, more reliable services. Further, many EMIs are either mere resellers of card schemes – which leads to a race to the bottom – or they have little to no infrastructure, which means they are cost and product-dependent on sponsor banks. At ISX Financial, we took a different approach early on. We built what we describe as a ‘banktech model’, combining fintech agility with bank-grade deep infrastructure. That means owning our technology stack, maintaining direct access to payment systems and central banks, and offering a complete multi-product ecosystem rather than a point solution. We operate across account issuance, open banking payments, mass payouts, FX and settlement, and SWIFT, all under a ’one stop shop’ framework. As one of the first non-bank participants Eurosystem’s T2 Real Time Gross Settlement (RTGS) system, ISX is now SWIFT capable without the need for a sponsor bank. ISX is able to transfer euros to any direct participant instantly, as well as rapidly to any of the 22,500 indirect participant banks. In this crowded market, survival is not about being the cheapest provider; it is about being structurally relevant. EMIs that invest in infrastructure, compliance and breadth of service are far better-positioned to support customers over the long term. That is where we have consistently focused our efforts and investments.
ISX Financial posted around 5% revenue growth in the first half of 2025. What has driven that financial performance?
Our financial performance in the first half of 2025 reflects steady demand for real-time, account-to-account payments and broader transactional banking services. Businesses are increasingly prioritising speed of settlement, certainty of funds, and cost efficiency, particularly in cross-border and digital commerce environments. Open Banking-enabled payments have been a key contributor, alongside continued growth in customer onboarding and deeper utilisation of our platform by existing customers. Notably, this growth was achieved without compromising financial discipline. We continued to make targeted investments in technology and people while maintaining operational efficiency. Instant settlement via open banking is a game changer. When we couple this with dispute management, refund management and cross- border settlements, there is an opportunity to challenge the card schemes and their online core offering. The broader trend we are seeing is that customers no longer want fragmented financial services. They want fewer providers, faster settlement, transparency, traceability and predictable outcomes. Our platform is designed to meet those needs, which has translated into sustainable revenue growth.
In 2025, the ECB made a landmark shift by granting non-bank payment service providers direct access to the Eurosystem payment system and ISX Financial was granted access earlier this year. What does this change mean for you and for Europe’s payments sector?
This is one of the most significant structural changes in European payments in decades. Allowing regulated non-bank payment institutions direct access to the Eurosystem, including TARGET2 and instant payment infrastructure, fundamentally reshapes the competitive landscape. When designing our infrastructure for T2 RTGS, we took the lessons learnt from being an early adopter of SEPA Instant, and architected a solution that load balances our traffic via two Central Banks, moving away from the conventional single path solution. This means that we can manage our traffic into T2 via independent pathways to optimise volume flow. For SWIFT payments, it reduces ISX’s reliance on correspondent banking chains, reduces settlement risk and improves efficiency. This also means that ISX has the capability to settle payments in central bank money without intermediaries, offering customers faster, more transparent, traceable and more resilient payment flows. It also raises a direct challenge to stablecoins – ISX can move euros between fiat accounts more rapidly than a stablecoin offering, as it does not have the complexity associated with on/off ramping of stablecoin from/to fiat. More broadly, this ECB change acknowledges the maturity of parts of the EMI sector. It recognises that well-regulated non-bank institutions like ISX can operate at the same level as banks to offer RTGS. Over time, this will accelerate innovation, improve competition and create new sets of standards across the European payments ecosystem.
PSD2 promised openness but delivered uneven implementation. As PSD3 approaches, do you expect a genuine course correction? And under the new regime, who stands to gain and who is likely to struggle?
PSD2 was directionally correct but operationally inconsistent, as it relied on sponsor banks and cooperation from other banks. The initial fragmented API standards and uneven enforcement across jurisdictions limited its effectiveness. PSD3 provides an opportunity to address those shortcomings by introducing clearer rules, stronger technical standards and a more harmonised regulatory framework. Those who stand to gain are institutions that have already significantly invested in compliance, infrastructure and scalable technology. PSD3 favours operators that treat regulation as a core capability rather than a constraint. Consumers and merchants should also benefit from more reliable open banking services and stronger fraud protection frameworks that are an improvement over the products offered by the card schemes. Conversely, providers that rely on regulatory arbitrage or minimal infrastructure investment may find it harder to compete. PSD3 raises the bar – and rightly so. It moves the industry toward maturity and sustainability rather than unchecked growth.
Beyond regulation, which three forces do you expect to shape the EMI landscape by 2028?
First, real-time payments will become the norm and the default expectation. Settlement speed is no longer a differentiator; it is a baseline requirement. Institutions that cannot operate on a 24/7, real-time basis will struggle to remain relevant. Second, consolidation is inevitable. The market cannot sustain hundreds of small EMIs offering similar services. Scale, efficiency and operational depth will drive mergers, exits and strategic partnerships. Third, technology, especially deep infrastructure coupled with automation and artificial intelligence, will redefine risk management, compliance and customer experience. AI will not replace governance but it will increasingly underpin how financial institutions operate at scale.
Looking ahead, where is ISX Financial placing its bets: technology, new products or something less obvious?
Further than enhancing operational and organisational resilience, our primary focus is on deep infrastructure-led innovation. That includes continued investment in our proprietary technology, expansion of real-time payment capabilities, and deeper integration with central bank and clearing systems. We are also investing in automation, emotional AI and advanced analytics to strengthen compliance and fraud prevention, ensuring that we can scale responsibly. Beyond products and services, we place significant emphasis on talent and governance. In a regulated industry, long-term success depends as much on people and discipline as it does on technology. Ultimately, our objective is not to chase trends but to build a platform that remains relevant as the payments landscape evolves. That requires foresight, hard work, patience and a willingness to invest ahead of the curve.
This Special Feature first appeared in the January edition of GOLD magazine. Click here to view it.
