Survey Finds 45% of Respondents Unconvinced of European Payments Harmonisation

Almost half (45%) of respondents to Travelex’s Payments Survey do not believe that harmonisation of European payments is a reality, despite the Payment Services Directive coming into law in November 2009 and the launch of the single euro payments area (SEPA) Direct Debit scheme at the same time. According to the survey, which polled 226 decision makers in banking finance, three in 10 believe that harmonisation is a reality, while 26% are not sure whether it is or not.

“I think it is quite amazing that 30% actually think [harmonisation] is a reality,” said David Sear, divisional managing director for Travelex Global Business Payments, in an interview with gtnews. “It proves to me that they haven’t recently made a payment. The simple fact is payment services haven’t really moved on. Although there has been some progress made in the basic services under SEPA, there isn’t a great deal of consumer awareness and, to be honest, I am not sure that there is consumer or business relevance being attached to it.”

The survey found the respondents were divided on whether the PSD creates greater value for businesses. Of those who expressed an opinion, 51% agreed this was the case, while 49% disagreed.

When asked to what extent they felt the PSD would facilitate the growth of payment institutions in Europe, 49% of respondents said they felt it was at least likely to facilitate growth, compared to 35% who said it was unlikely to. Almost one in five (17%) stated they were unsure.

The survey also found:

  • Just over a quarter of respondents (26%) expected PayPal to continue to have a major influence in more than five years time. Seven percent felt that it would only have a majority share for the next year, perhaps suggesting that they think PayPal is not a popular payment method, or that there are other payment services on the horizon that could soon take a market share from PayPal.
  • Two-thirds of financial decision makers felt that it was unlikely that mobile payments will become the main form of payment and card payments obsolete.
  • Around three-quarters of respondents (74%) thought it was unlikely that payment technology would be an investment priority for their company in 2010.

“Despite many banks saying they are returning to core banking, it is surprising that such a high percentage of respondents are not investing in payment technology,” said Sear. “With the PSD comes a regulatory environment which encourages new entrants and yet banks are not willing or able to invest. There are technology companies and payment institutions that are innovating in this space, and there is a gap created by the larger banks’ inability to invest in this kind of technology and capability.”


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