EPC's SCARLET Scheme Could Change How You Use Your Digital ID

Alejandro Martínez · 2026-10-21

The European Payments Council (EPC) just announced a new scheme called SCARLET, and it's all about making EU Digital Identity Wallets work smoothly for payments. If you're in the payments world, you know that digital identity is the next big thing. But what does this mean for you? Let's break it down. ### What's SCARLET and Why Should You Care? SCARLET stands for something like "Secure and Consistent Authentication for Remote Transactions" (the exact acronym isn't public yet, but you get the idea). The EPC is developing it to create a common standard for how digital identity wallets can be used across Europe. Think of it as the rulebook that makes sure your digital ID works the same way whether you're in Germany, France, or Italy. Right now, the EU is pushing hard for Digital Identity Wallets that give citizens control over their personal data. But without a unified scheme, payments could get messy. SCARLET aims to fix that by setting technical and operational guidelines. ### How Will This Affect Payments Professionals? If you work in payments—whether you're a developer, a product manager, or a compliance officer—SCARLET will likely impact your roadmap. Here's what to watch for: - **Standardization:** You won't have to build separate integrations for each country's digital ID system. One scheme to rule them all (well, at least in the EU). - **Security:** SCARLET will define security requirements, so you can be confident that transactions are safe. - **Interoperability:** Your systems will need to talk to different wallets seamlessly. That means new APIs and testing. But it's not just about tech. There's a business angle too. If digital ID wallets become the norm for payments, customer expectations will shift. People will want faster, safer checkout experiences. And companies that adopt early could gain a competitive edge. ### The Bigger Picture: Wero and European Payments SCARLET isn't happening in a vacuum. It's part of a broader move toward European payment sovereignty. Remember Wero, the new pan-European payment initiative? Well, digital identity is a key piece of that puzzle. With SCARLET, the EPC is laying the groundwork for a future where your digital ID wallet can be used for everything from paying at a store to accessing government services. > "The SCARLET scheme is a critical step toward a digital single market in Europe. It's about trust and convenience—two things that payments professionals care deeply about." — Alejandro Martínez, Finance Director Of course, there are challenges. Privacy advocates worry about surveillance. Banks worry about losing control. And everyone worries about implementation costs. But the EPC seems committed to a collaborative approach, working with stakeholders to get it right. ### What's Next? The EPC hasn't set a firm timeline yet, but expect drafts and consultations in the coming months. If you're affected, keep an eye on the EPC's website and industry forums. And start thinking about how your systems will need to adapt. In the meantime, if you're in the US, you might be wondering why this matters to you. Well, many US companies have European operations or partners. And standards tend to travel. So even if you're not in the EU, SCARLET could influence global practices. Bottom line: SCARLET is one to watch. It's not just another acronym—it's a sign of how payments and identity are converging. And that's something we should all pay attention to.