30 June 2015

EPC Publishes report on instant payments

The report highlights that the expectations of both payers and payees must be the starting point in developing an approach for instant payments in SEPA. This should form the basis for the discussion within the ERPB.

The entire contents of this report are based on ‘desktop’ research and discussions among the EPC members only. This report must therefore be seen as a preliminary contribution from just one SEPA stakeholder. With this document, the European Payments Council contributed to the debate on instant payments at the Euro Retail Payments Board (ERPB) meeting on 29 June 2015 .

The report highlights that the expectations of both payers and payees must be the starting point in developing an approach for instant payments in SEPA. This should form the basis for the discussion within the ERPB. The first action to undertake should be to understand what payers and payees actually expect from instant payments.

The report outlines the opportunities that instant payments may bring but also draws attention to specific issues. One issue the EPC highlights to the ERPB is questioning which “go to market” scenario would be the most appropriate to reach the full potential of instant payments in SEPA. The roll-out of an instant payment solution supported by various PSPs will demand that these, along with payment infrastructure providers and corporate payment service users, all allocate substantial resources to and carefully internally plan their part in the roll-out. They should coordinate on a regular basis with each other as the implementation progresses.

At this stage, the EPC is of the opinion that there may be a need for an instant payment scheme at SEPA level. With the current ERPB definition in mind and subject to the position and expectations of the other stakeholders from the supply and demand side, a majority within the EPC consider that the credit transfer could be a suitable payment instrument, as a first step, for instant payments in SEPA. On the other hand, the EPC points out that other payment instruments, notably electronic money and payment cards, are also suitable for instant payments. Certain existing instant payment solutions are based on these particular payment instruments.

In view of the benefits of broadening the discussion in an ERPB multi-stakeholder environment, the EPC has recommended the establishing of an ERPB instant payments working group with the mission of analysing what the end-to-end requirements for pan-European instant payment scenarios would be.

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