On 11 July the European Parliament’s Economic and Monetary Affairs Committee did not challenge the European Commission’s (EC) December 2010 proposal for a single euro payments area (SEPA) migration regulation. The committee rejected most of the many amendments submitted by members of the European Parliament. These amendments were aimed at enhancing a proposal which combines the necessary setting of end dates for existing national credit transfer and direct debit schemes with minute technical arrangements and far-reaching policy orientations. This intended commission regulation should lead to EU-wide adoption of single credit transfer and direct debit schemes.
Although the text adopted on 11 July (still to be submitted to the vote of the European Parliament plenary) sets dates for the discontinuation of existing national payment systems (setting such dates by legislation had actually been requested by the European banking payment industry), the same text also sets technical requirements for the pan-European credit transfer and direct debit schemes, which may not be welcomed by European consumers.
Furthermore, the text bans interchange for direct debits, negating that the successful existing direct debit models in the eurozone are based on interchange and that the latter protects consumers from paying for benefits retained by creditors. Creditors (typically large companies, e.g. utility providers) had already announced that they will not pass along any savings to consumers. Banning interchange for direct debits sets a precedent, which will negatively affect the emergence of interoperable, innovative solutions.
“This is not a helpful development,” said European Savings Banks Group (ESBG) managing director Chris De Noose. “This text was the opportunity to show consumers that pan-European initiatives can combine convenience for them and the policy internal market objective. This text could also have motivated payment service providers to continue and innovate. It is a pity that the EC proposal was not challenged much at Parliament Committee level. Both European users and providers of payment services now have to hope that the European Parliament plenary takes a broader approach in order to keep alive the potential for both a consumer-convenient and innovative single market for payments.”
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