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The latest edition of the EPC Newsletter, published quarterly by the European Payments Council (EPC), takes a closer look at developments expected to shape the future of European payments in 2015 and beyond.
Javier Santamaría reports on preliminary conclusions reached at the session ‘payments – improving users’ experience and looking into the future’ hosted by the European Commission at its conference on emerging challenges in retail finance and consumer policy which took place on 18 November 2014. Santamaría points out: “The speed at which developments evolve and their impact on society, at multiple levels, pose new challenges to building future scenarios that may claim to provide at least an approximation to new emerging realities.”
“The probability that a new solution – which could render mid to long-term predictions obsolete – is just around the corner, should be factored into the scenario building exercise,” he adds.
To illustrate the point: in December 2014, the European Banking Authority (EBA) published its finalised guidelines on the security of internet payments that payment service providers in the European Union (EU) will be expected to implement by 1 August 2015. The guidelines are based on recommendations first issued by the European Forum on the Security of Retail Payments (SecuRe Pay) in January 2013.
Examining the EBA guidelines, Etienne Goosse comments: “In the last two decades many security solutions were implemented, only to have been rendered obsolete as technology evolves.” For example, since the issuance of the Secure Pay recommendations on the security of internet payments in 2013, “tokenisation has been picked up as one of the prevalent security solutions in any future e-payments system but, understandably, at the time of publication, the recommendations did not take tokenisation into much consideration.” The EPC therefore, suggested that new developments would be taken into account when finalising the EBA guidelines as otherwise “innovation in this area could be seriously hindered.”
With regard to scenario building in the digital age, Santamaría concludes: “Thinking outside the box is a valuable exercise. Keeping in mind established wisdom doesn’t hurt either. Regulation – now and in the future – should strive to achieve legal certainty, balance, technology neutrality and a level playing field amongst all players.”
This EPC Newsletter also covers the following topics, among others: