Commission announces roadmap to SEPA

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The European Commission yesterday (10 September) laid down a roadmap for rolling out the Single Euro Payment Area (SEPA) intended to create the same rules and standards on electronic payment services in euros.

"Today a harmonised framework is available for credit transfers with common standards," a statement from the Commission said. Frameworks for direct debits, due to come into force by 2 November 2009, and SEPA cards were also announced. 

In the past, consumers and SMEs have expressed reservations about SEPA, fearing that transaction fees would unfairly penalise both groups. Multilateral Interchange Fees (MIFs), fees charged to the receiving bank often passed down to the consumer or client, have come under scrutiny by the Commission and by EuroCommerce, a retail sector lobby group. 

The retailers' lobby initiated competition cases against the card industry's "anti-competitive prices" and argued that MIFs prevented new players from entering the market at a lower cost. The Commission also challenged the legality of MIFs imposed by Visa (EURACTIV 27/03/08) and Mastercard (EURACTIV 04/03/08) on international card transactions, based on the argument that consumers were being unfairly penalised. 

The Commission insists that the new regulation on cross-border payments will "extend the principle of equal charges for national and cross-border payments to direct debits". It is due to come into force on 1 November 2009. 

Regarding MIFs, EuroCommerce Seceratry-General Xavier Durieu wants SEPA discussions to involve all stakeholders, including end-users who could likely incur such fees. 

"We very much hope that the EU SEPA Council, proposed in the communication, and the increased – but still insufficient – involvement of stakeholders in the discussions will help SEPA to improve today's very worrying situation," Durieu said in a statement welcoming the Commission's roadmap. 

The EU executive appears to have taken note of the need to balance the interests of different stakeholders as it says that improved governance at the European Payments Council is needed to monitor the project. "Greater transparency and early involvement of all stakeholders in the planning of future initiatives need to be ensured." 

Internal Market Commissioner Charlie McCreevy called for greater cooperation between regulators and market players to ensure that SEPA is as efficient and secure as possible: "By providing a roadmap where actions, actors and deadlines are clearly identified, this communication will play a decisive contribution in helping SEPA successfully achieving its last miles." 

EuroCommerce Secretary-General Xavier R. Durieu stated: "We are particularly satisfied by the Commission's commitment to keeping close scrutiny on competition issues and on price developments," but insisted on "the involvement of stakeholders in the discussions [to] help SEPA to improve today's very worrying situation". 

The Single Euro Payments Area, or SEPA, is an industry initiative seeking to extend the possibilities offered by the common European currency to electronic and non-cash payments. At the moment, cross-border transactions in Europe are only possible under a range of different national schemes that make them more complicated and less reliable. 

The first phase of SEPA has already been in place since January 2008. It concerns credit transfers in euros, with the final objective of making them as quick and cheap to conclude at EU level as they are at national level. 

The second step should be introduced by November 2009, with the creation of a SEPA common instrument for direct debit operations. Finally, all payment cards in the EU should be replaced with SEPA-compliant cards by the end of 2010 (see EURACTIV LinksDossier). 

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