Banking chiefs will attend a meeting on Thursday to establish a national alternative to Visa and Mastercard amid growing fears that US political decisions could leave the country’s payment systems offline. The summit, chaired by Barclays’ UK chief executive Vim Maru, will bring together City funders who will finance the launch of a new payments company designed to safeguard the UK economy in the event of disruptions to existing US-owned systems.

The initiative, known internally as DeliveryCo, has been under discussion for several years, but recent threats from Donald Trump over Greenland and other foreign policy tensions have intensified concerns about reliance on US-controlled payment networks. About 95% of UK card transactions are processed through Visa and Mastercard, according to a 2025 report from the Payment Systems Regulator, making the country highly vulnerable should these systems be disrupted.

If Mastercard and Visa were “turned off”, the UK economy “would be sent back to the 1950s,” forcing businesses to rely solely on cash, one insider told The Guardian.

Cash usage has been steadily declining, increasing the nation’s exposure to potential digital payment failures. The risk is not hypothetical. In Russia, US sanctions forced Visa and Mastercard to suspend services, leaving people unable to access funds.

Similar concerns are now being raised across Europe, where policymakers are actively pursuing locally owned networks that cannot be switched off by foreign governments.

Aurore Lalucq, chair of the European Parliament’s economic and monetary affairs committee said: “Visa, Mastercard … the urgent issue is our payment system. Trump can cut everything off. The rest is poetry. I urgently request that the commission organise a European Airbus for payment systems: you can’t say you weren’t warned.”

Despite these warnings, the UK is pursuing a less confrontational approach. Both Visa and Mastercard are part of the new funders’ group, alongside major UK banks including Santander UK, NatWest, Nationwide, Lloyds Banking Group, and Coventry Building Society, as well as the ATM network Link.

This joint structure gives the US firms a stake in DeliveryCo while ensuring UK oversight. Officials have framed the project in terms of resilience rather than political risk.

Bank of England deputy governor Sarah Breeden: “In the context of a challenging and changing cyber and operational risk environment, it could provide a degree of extra resilience in the UK payments landscape, as an additional payment rail on the rare occasion of operational disruption to existing rails.”

Joe Garner, former Nationwide chief executive and adviser on national payments: “Regardless of any political developments, the UK needs to do this. We needed to before, we need to now … I don’t think that’s changed by recent events.”

City funders will be responsible for developing DeliveryCo’s legal structure, leadership plan and funding model, while the Bank of England will design the technical infrastructure, with plans expected to be handed over to the private sector next year.

Sources indicate the system could be operational by 2030. Both Visa and Mastercard have reaffirmed their commitment to the UK.

A Visa spokesman said: “We welcome the industry progress on account-to-account payments in the UK. We believe competition between multiple solutions, supported by a level playing field, will deliver choice, innovation and economic growth in the UK.”

A Mastercard spokesman said: “Mastercard has been fully invested in the UK for decades, delivering consumers and businesses with a wide range of convenient, simple and secure ways to pay and get paid. We remain committed to drive commerce here at home and across the globe by helping businesses of all sizes grow and meet the needs of their customers.”

UK Finance, which has administered the DeliveryCo project, the Treasury and the Bank of England have all been contacted for comment.

UK businesses will be potentially attractive to European businesses after Brexit and Donald Trump’s trade tariffs, an expert has suggested. The current trade environment places British firms in a good position, they argued, as Britain has negotiated trade deals with both the US and EU, and Mr Trump announced 15% tariffs on most of the bloc’s exports. In addition, Switzerland, which is not an EU member, faces a 39% tariff – the highest in Europe and fourth highest globally. This has “left many Swiss firms grappling with the threat of severe economic repercussions”, Aman Parmar, Head of Marketing at BizSpace, a small to medium business (SME) flexible workspace firm.

The EU and the US announced on July 29 that a trade deal would see a 15% ceiling on all EU exports currently subject to reciprocal tariffs. This also applies to cars and car parts, as well as any potential future tariffs on pharmaceuticals and semiconductors. However, European wines and spirits did not make it on the list of items exempt from the 15% levy. A 10% tariff will remain in force for countries with which the US has a trade surplus, which includes most states.

The House of Commons outlined the UK’s tariffs on July 30 as follows. In March, President Trump imposed a 25% tariff on all aluminium, steel and derivative goods imports.

From April 3, there was a 25% tariff on all passenger vehicles and light trucks. Tariffs of 25% on automobile parts were due to be implemented from May 3.

From April 5, a 10% baseline tariff on imports from the UK, affecting most goods.

Mr Parmar added: “This dramatic difference in tariff conditions could position the UK as a key indirect beneficiary of these tariffs, enabling it to reclaim some of the trade and investment lost post-Brexit.”

The expert also said: “The aftermath of the 2016 Brexit referendum saw many British businesses shift operations to mainland Europe, leading to initial uncertainties and a decline in exports.

“However, the prospect of US President Trump’s newly imposed tariffs is prompting companies to reassess their strategies.

“Similar to the situation faced by smaller Swiss firms, particularly in the watch and machinery sectors, UK SMEs might find themselves in a position to attract displaced EU businesses.

“In Switzerland, for instance, a fifth of the watches and jewellery produced are exported to the US; analysts suggest that the impact of US tariffs will disproportionately affect the lower-end segments of these markets.”

Swiss government held crisis talks on Monday in an attempt to finalise a proposal that might dissuade US President Donald Trump from imposing 39% tariffs on the country, Bloomberg reported.

Mr Parmar said: “With Switzerland now facing a staggering 39% tariff – the highest in Europe and globally the fourth highest behind only Syria, Laos, and Myanmar – it underscores the vulnerability of smaller exporters, which the UK could leverage to attract businesses seeking more stable conditions.”

The Pound has surged to a seven-month high against the US Dollar, indicating increasing market jitters and doubts about the stability of the US currency. A combination of economic concerns and sharp criticism from Donald Trump directed at Federal Reserve Chairman Jerome Powell has renewed fears over the potential undermining of central bank independence.

As a result, the Dollar slumped to three-year lows, while the Pound surged above the 1.3400 mark, reports currencynews.co.uk. The euro also strengthened, reaching 41-month highs above 1.1550, while gold hit a new record. US equity futures showed signs of decline as markets responded to the heightened uncertainty.

MUFG analysts warned that any further moves to challenge Mr Powell’s position could provoke significant market volatility, particularly in foreign exchange markets.

Stephen Innes from SPI Asset Management noted that the reputational damage to the US as a global leader is now undeniable, with investors and central banks factoring in the growing instability of US policy.

Mr Trump’s continued attacks on Mr Powell – including branding him “Mr Too Late” and a “major loser” – have deepened concerns about the political influence over monetary policy, further undermining confidence in the Dollar.

Trade tensions with China also contributed to the Dollar’s decline, as Beijing’s harsh rhetoric escalated and undermined investor sentiment.

Mr Trump’s focus on tariffs and domestic taxation has made it more difficult for the US to secure beneficial trade agreements, further impacting the Dollar’s standing on the global stage.

Commenting, Stephen Innes of SPI Asset Management, said: “The dollar is slipping on more than just thin liquidity and soft data — it’s slipping on faith.

“Markets are starting to question one of the bedrock assumptions behind the dollar’s reserve currency status: an independent, inflation-fighting Fed.

“With President Trump ramping up public pressure on Powell to slash rates “now,” we’re not just flirting with jawboning — we’re staring down the barrel of a credibility unwind.”

The weakness was not just about economic cracks forming, Mr Innes stressed.

He explained: “This is a broader confidence bleed. Trump’s rhetoric signals that even the White House is front-running a slowdown. And that means the usual fallback narrative — ‘we’re strong, the Fed has our back’ —is starting to fray.

“The Easter Monday dollar dump was no fluke.

“It was a clean sweep: rate expectations got repriced, and the dollar’s safe-haven mantle took a hit.”

The pound was valued at just under $1.34 as of 10am.

The FTSE 100 index has plummeted to its lowest level in two months after Donald Trump announced a wave of tariffs on Tuesday.

When the index closed yesterday, the London stock market was down by more than 100 points, 1.2% to 8496. It was the sixth session in a row to fall.

British Airways owner IAG fell by the largest figure, down 6.4%, while Holiday Inn owner IHG was also down by 3.6%. Pest controller Rentokil fell by 4.5%, and industrial components groups Diploma and Spirax were down 4.4% and 3.8%, respectively.

It comes as US stocks dropped again after huge uncertainty caused by the President’s tariffs plan.

Donald Trump‘s global trade war has escalated, with a 25% levy on steel and aluminium coming into force overnight in the UK and EU.

The European Commission has vowed to impose “countermeasures”, with European Commission Ursula von der Leyen saying: “We deeply regret this measure. We are ready to engage in meaningful dialogue.”

However, Britain is keeping a “cool-head” as Exchequer Secretary to the Treasury James Murray says “the UK is in a “very different position than the EU”.

“The UK and the US have been negotiating rapidly for an economic agreement, and so we’re in a position where that negotiation is ongoing and these global tariffs, if you like, have landed in the middle of that work,” he told Sky News.

“So we don’t want to be pushed off course by this.

“We want to carry on with our rapid negotiation toward an economic agreement, because we think that’s in the best interest of British businesses and the British public.”

The FTSE 100 has, however, opened higher this morning after Donald Trump reversed his plans to double tariffs on Canada’s steel and aluminium sector.

Tuesday saw the UK’s blue-chip index drop 1.2% following the announcement to raise metal tariffs to 50% levy on his closest ally.

After Canada hit back with a retaliatory 25% electricity export tariff, the President backtracked down to his original plan of 25%. This saw the the FTSE 100 bounce back by 0.2% to 8,512.37.