Commissioner Barnier: Retail payments - A lever for inclusive and innovative growth in Europe

21 October 2013

Retail payments are not simply a technical issue, they form an important lever for our response to the crisis, said Barnier at a joint ECB/Banque de France conference.

Translated from the French

In Europe in recent years, the topic of payments has been overshadowed by the emergency of the economic, social, financial and fiscal crises. Let me be clear: it is a mistake to let this happen! Retail payments are not a simple matter of technical nature, but an important lever of our response to the crisis.

It is the goal of our legislative package presented on 24 July to modernise the electronic payments market. This ambitious proposal is based on a simple observation: every day in Europe, more and more consumers use the Internet for their online shopping. In addition to online payments by credit card, new payment services emerge, including payments by mobile phone. Yet, the development of these new technical possibilities often clashes with the lack of consumer confidence, as they doubt the security of online payments.

Moreover, the European payments market remains fragmented and its cost is estimated at €130 billion per year. With our proposal, we aim to make online payments cheaper and safer. By including these new payment methods, we will also promote innovation and competition between operators for the benefit of consumers - who will have the choice between several modes of payment and traders - who will be offered payment cheaper that debit cards and most credit cards. This will also reduce the cost of payments and eliminate a significant barrier between the national markets as we have proposed capping interchange fees at 0.2 per cent for debit cards and 0.3 per cent for credit cards. This reform should be largely positive for consumers. Our proposal has also received the support of many consumer organisations, including BEUC.

These are our priorities:

• First, we must ensure that our legislative proposals of 24 July will enter swiftly into force.
• Second, we must complete the migration to SEPA. We can not continue to have a single currency and 18 different electronic payment systems. This vision will become a reality in February 1, 2014. 
• Thirdly, our proposal on access to a basic payment account: all consumers who are legally resident in the EU should have the right to open a basic bank account in any Member State, regardless of their financial situation.

Full speech (in French)

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