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The future of EU payments: fees, instant payments and evolving infrastructure

The European Payments Council (EPC) has published its June newsletter, which covers the future of instant payments, the impact of the card interchange fee regulation and payments in the US and Finland.

The topic most relevant to corporate treasurers is the card interchange fee regulation, which came fully into effect yesterday, 9 June, ensuring a cap on interchange rates for consumer cards across the EU. The regulation introduces an ‘interchange plus’ pricing structure rather than a blended pricing structure by acquirers, which will affect the fee that companies pay each time they process a card payment. For more detail on the card interchange fee, read the EPC's article.

Have your say on instant payments

Stakeholders are also encouraged to participate in the public consultation on the Sepa Instant Credit Transfer (SCT Inst) scheme, which will end on 10 July 2016. The SCT Inst scheme is due to come into effect in November 2017 and will enable payments of up to €15,000 to be made in less than 10 seconds throughout the single euro payments areas (Sepa). This will drastically cut the time it take for payments to be credit to the payee's account (currently this can be 24 hours or more in Europe). Companies will benefit by having instant value credited to their accounts. Read the EPC's summary for more info on instant payments

Four proposals for changing Europe's RTGS system

The future of real-time gross settlement in Europe is also discussed and the ECB's Sylvain Debeaumont and Antonia Hamova write in their article that “exciting times lie ahead for Europe’s financial market infrastructure”. Four action points have been put forward to develop the two systems that form the backbone of the financial market infrastructure in Europe – TARGET (the real-time gross settlement (RTGS) system for the euro) and TARGET2-Securities, or T2S (the single securities settlement platform). The action points are:

  1. technical consolidation of TARGET2 and T2S;
  2. development of new RTGS services;
  3. support for instant payments settlement; and
  4. harmonisation of Eurosystem arrangements and procedures for collateralisation.

The graph below – from the ECB – shows the future vision for TARGET and T2S.

Other items included in this month's EPC newsletter are and article on What does the future hold for US domestic payments? and as well as an article on payments in Finland and The latest payment reports that you need to read.

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This item appears in the following sections:
Payments - Receipts
Accounts Receivable Management
SEPA Payment Structure & Services
Payments - Receipts at POS
Card Payments at POS
Collecting Payments via Mobile
Payments - Disbursements
Accounts Payable Management
Paying Suppliers

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