Payments without the Internet: Europe is preparing a response to geopolitical and hybrid threats
12 May 14:21
Finland, Sweden, Norway, Denmark, and Estonia are introducing offline card payment systems to provide a backup option in case of loss of Internet connection, including due to sabotage. This was reported by Reuters with reference to a statement by Tuomas Valimaki, a member of the Board of the Bank of Finland, "Komersant Ukrainian" reports.
These plans come after the Baltic Sea region has recently suffered several cases of unexplained damage to critical underwater infrastructure, and Western intelligence services have accused russia of committing various acts of sabotage.
“The likelihood of serious disruptions has increased as the geopolitical situation has changed around the world. There is a war going on in Europe, and all sorts of hybrid influences are taking place around this war, which may include disruption or severance of ties,” Tuomas Valimaki said.
Payments are a potential target for hybrid attacks
According to the central bank of Finland, only 10% of people in the country use cash as their primary payment method, making the country highly dependent on card payments.
“Since card payments require functioning international data channels, Finland needs to be prepared for disruptions. Many other countries, of course, are in the same situation,” Valimaki said.
According to him, Norway, Sweden, Denmark, and Estonia are also planning to introduce offline card payments.
What could be an alternative to online payments?
The plans are still being developed, but offline payments may involve the use of terminals that encrypt and store transaction data until the Internet connection is restored.
Sweden’s central bank told Reuters that it hopes to have a system in place by July 1, 2026, that will allow Swedes to make offline payments with cards to buy essential goods in the event of a service outage of up to seven days.
The central banks of Norway and Denmark have stated that they have already launched offline electronic payments, which they continue to develop.
Not only hybrid threats, but also real geopolitics matter
The whole of Europe needs to reduce its dependence on card payments, which are currently largely dependent on American companies. This is the opinion of Tuomas Valimaki, a member of the Board of the Bank of Finland.
“We cannot rule out that one evening someone on Truth Social will not start using payments as a pressure tactic,” he said.
Reuters reminds that Truth Social is a social network where US President Donald Trump publishes many of his ideas.
To provide an alternative, Finland, for example, intends to introduce a national instant payment system in a few years, while offline payments will become available to consumers next year.
The European Central Bank is planning to introduce a digital euro that will allow instant payments, but it will take years to create such a system, even if it secures the necessary political support from all eurozone countries.
Tuomas Valimaki, a member of the Board of the Bank of Finland, also said that as part of another effort to protect financial security, the country is introducing a national system of reserve bank accounts. Thanks to this system, the National Financial Stability Authority will be able to provide Finns with access to their savings even if their bank fails.
Last November, two submarine fiber optic cables were damaged in the Baltic Sea. One connects Germany with Finland, and the other connects Sweden with Lithuania. At the time, these countries said that security in the region was threatened by a “hybrid war by malicious actors” and the conflict between russia and Ukraine.
Earlier, last winter, an underwater electric cable connecting Finland to Estonia was severed. And in October 2023, telecommunications cables connecting Estonia to Finland and Sweden were damaged.
