The European Central Bank is floating the idea of using instant payment rails to link up national card schemes as a means to break the duopoly enjoyed by Visa and Mastercard, who between them account for over 80% of all EU card transactions, according to finextra.com.
The ECB has for the past twelve years been seeking a mechanism to challenge the dominance of Visa and Mastercard in the European payments landscape. Interchange fee caps have brought a measure of control, but calls for banks to set up a rival third scheme to take on the might of the global giants and promote increased competition have so far fallen on deaf ears.
In a presentation at the American European Community Association in Brussels, ECB board member Yves Mersch lamented the bloc’s failure to implement a true Singe Euro Payment Area (Sepa) for cards.
„Cardholders cannot use their national payment cards to make payments across Europe unless they go through a global card payment scheme that can execute such intra-European payments,” he notes.
In this respect, the arrival of instant payments across the continent could be a game changer.
„The industry sees the implementation of a European infrastructure for instant payments as an opportunity to instantly clear and settle card transactions, which would offer a possible way of supporting the interlinking and interoperability of national card schemes,” he says. „Efforts to ensure the interoperability of schemes should be strengthened and should aim to foster a European identity, for example by using a common European logo to show users that their cards can be used across the EU.”
A more radical supposition entails the extension of instant payments to the point-of-sale, bypassing traditional card schemes altogether.
„For merchants, instant payments at the POI (point of interaction) could be a cost-efficient alternative to cards,” says Mersch. „Such solutions are currently emerging across Europe. It is important to ensure that they have pan-European reach so that end users can make and receive payments without restriction across national borders”
To this end, the Euro Retail Payments Board – set up by the ECB to help foster the development of an integrated market – has established a working group to analyse in detail the barriers to pan-European reach and usability and ways to overcome them.
„O singură provizie am făcut, de card, pentru că nu mai umblu cu banii în buzunar. Banii sunt cei mai periculoși când este vorba de răspândirea unei molimi. Am renunțat la cash. În rest, este o prostie să faci provizii. Dacă vine o molimă și nici nu știi când va ajunge, dacă ar fi să se întindă, pe cât timp să poți să faci provizii? Faci provizii pe trei săptămâni, pe patru săptămâni și mai departe?”, a spus consultantul.