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IMGCAP(1)]The European Central Bank continues to push for the creation of a third pan-European card network, but it has no plans to subsidize or launch a new scheme, a central bank official said Thursday at the Cards & Payments Europe 2008 conference in Brussels, Belgium. Francisco Tur Hartman, deputy of the bank's payment systems policy division, says the Single Euro Payments Area could harm competition if Europe is left with a "duopoly" of card schemes handling cross-border debit payments. "Will there be any competition with Visa and MasterCard?" asks Hartman. "We hope so. We are happy with Visa and MasterCard, but we hope there [will be] competition." The central bank plans to urge financial institutions and other payment-industry players to launch a new scheme when the central bank issues its sixth progress report on the SEPA rollout later this year, says Hartman. The central bank called for a third card scheme last year in its fifth progress report. The central bank monitors financial institutions' implementation of SEPA, which is designed to tear down national borders for electronic payments. But the central bank does not exercise direct authority over the way institutions meet the SEPA mandates. At least some central bankers believe a Visa/MasterCard hold on cross-border card payments could drive up fees for merchants. "Are we prepared to deliver a card scheme ourselves? At the time being, no. We would like the market to deliver it," Hartman says. Market observers say a European Commission ruling late last year against MasterCard's cross-border interchange rates makes it more difficult for European banks to build a business case for a third scheme. Despite that, some big banks in France and Germany have told European regulators they are considering launching a new card brand, the so-called "Monnet scheme," although they would need more "clarity" on interchange before moving forward. Another group, the Euro Alliance of Payment schemes, centered in Germany, also is weighing prospects. And a Belgium-based startup, European Payment Solutions, says it plans to test a third scheme called "PayFair" by 2009. A large merchant, likely in Belgium, would issue the debit cards and accept the payments for that trial.
June 20 -
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Idaho Central Credit Union, the state's largest credit union based on assets and members, is converting all 40,000 of its signature- and PIN-debit cards to PSCU Financial Services' debit-processing platform, the companies announced yesterday.
June 19 -
The Desoto, Tex., bill-to-phone payment processor eTelcharge.com Inc. has a deal to buy a larger rival, PaymentOne Corp. of San Jose.
June 18 -
The Dutch transaction processor Equens NV is testing a biometric fingerprint payment authorization system with a supermarket chain there — a model that has failed to catch on in this country.
June 18 -
Two providers of payment services for utilities are collaborating to deliver a prepaid wireless metering system for electricity providers.
June 18 -
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Visa Europe will keep its cross-border interchange rates as is, even though MasterCard Europe, facing hefty fines from European regulators, said Thursday it would "temporarily repeal" its rates while continuing its appeal of the regulators' decision. "The announcement has no impact in Visa Europe's interchange," Visa said in a statement issued Friday. "We are in ongoing talks with the European Commission about how we (will) set our interchange in the future, and these continue." The commission is investigating Visa Europe's interchange and card practices. In December, it gave MasterCard six months to lower its rates or face paying daily fines amounting to 3.5% of global revenues. Regulators say the rates are anticompetitive. On Friday, Visa Europe repeated that it hoped to reach agreement with the commission. But one analyst questioned how much negotiating power Visa has in the wake of MasterCard's interchange decision. "The way the situation is evolving, it's clear that MasterCard and Visa have little leverage over the [commission]," Gwenn Bézard, senior analyst for the Aite Group, a United States-based consultancy, tells CardLine Global. "It's not good news for Visa." Meanwhile, European retailers welcomed MasterCard's decision to repeal its rates. "This signals a major victory in the battle against this hidden taxation of purchasing, which will bring significant benefits to consumers and retailers," retail trade association EuroCommerce said in a statement issued Friday.
June 16
