The European Union (EU) reports progress towards making payments in euros cheaper, following the Council’s adoption of regulation on aligning the costs of cross-border payments between euro and non-euro countries and increasing transparency for charges related to currency conversion services across the EU.
The aim is for the cost of paying or withdrawing money in euros anywhere in the EU to be the same as at home.
Since 2002, the same charges have applied to cross-border and national payments in euros within the euro area, while cross-border payments in euros from non-euro countries are subject to high fees.
The reform will align the charges for cross-border payments in euros for services such as credit transfers, card payments or cash withdrawals with the charges for corresponding national payments of the same value in the national currency of the EU member state where the payment service provider (PSP) of the payment service user is located.
This measure will extend the benefits of cheap cross-border euro transfers to an additional 150 million non-euro area consumers, and a potential extra 2.5 billion transactions per year.
In addition, further transparency requirements will be introduced on charges for currency conversion services. When consumers make card payments or withdraw cash abroad, they can choose whether to pay in the local currency or their home currency.
Under the new rules, consumers will be informed of applicable charges before making their choice. This will be achieved by introducing an obligation to disclose the charges applied as a percentage mark-up of all currency conversion charges over the latest available exchange rate of the European Central Bank (ECB).
The new level of transparency aims to raise consumers' awareness, thereby enhancing competition between different currency conversion services providers.
Most of the provisions will be introduced from 15 December 2019.
Like this item? Get our Weekly Update newsletter. Subscribe today