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Leading French and German banks hope to decide within months on whether to set up a European debit card payment network that would be a rival to schemes operated by MasterCard and Visa.
The banks – which include Commerzbank, Deutsche Bank, Société Générale and BNP Paribas – are in talks with the European Commission over the plan but want more regulatory clarity before they decide to go ahead.
Interest in a home-grown payment scheme comes as MasterCard and Visa have come under scrutiny by Brussels for the level of interchange fees charged when processing card payments. It also follows stock exchange listings by Visa and MasterCard that banks fear will reduce their negotiating power with the US companies.
However, a person familiar with the plan – dubbed “Monnet” – said the Commission would need to accept an appropriate level of interchange fees before the banks would invest in a pan-European system. Banks might prefer to continue to use Visa and MasterCard without “a clear solution” from the Commission, the person said.
The EU and institutions such as the European Central Bank have been keen to encourage new consortia to process debit and credit card transactions, believing customers could benefit from lower costs. This year a single European payments area has been introduced in 31 countries and by next year it is intended that direct debit transactions should cost the same across Sepa.
Banks in Germany and France would give any scheme a critical mass, according to those familiar with the plans, since the two countries account for almost one-third of debit payments within Sepa.
Officials in the Commission’s competition department confirmed there had been contacts with the Franco-German consortium, along with several other parties. They stressed that no decisions on the merits of any scheme had been made.
A spokesman for Charlie McCreevy, the internal market commissioner, said that it was essentially for market participants to decide what action they wanted to take but that it had always been envisaged that Sepa would encourage new players into cross-border payments.
By James Wilson in Frankfurt and Nikki Tait in Brussels