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12 April 2006

Commission Consultation on Interim Report on Payment Cards and Payment Systems

The Commission started a public consultation on its interim report on Payment Cards and Payment Systems. The preliminary results of the inquiry show a picture of market fragmentation. The inquiry suggests that building a true Single Euro Payments Area (SEPA) still requires considerable work to be done. It must be recognised that fragmentation in payment markets, and in card payment markets in particular, is partly the result of historical evolution.

However, change appears necessary to move forward towards a SEPA. Lessons for building SEPA could also be learnt by looking at efficient payment services provided by existing domestic card networks. Such networks offer in some respects a good value proposition to customers and often charge lower fees to cardholders and business than the large international networks (MasterCard and Visa). A challenge remains in creating efficient cross-border functionalities as a pre-requisite for SEPA. The future choice of SEPA payment schemes by banks is a key issue for the further debate on SEPA.

The European payment cards industry is large and handles a significant part of retail sales in Europe. Total sales volumes with point-of-sale card transactions in the EU in 2005 were more than Euro 1350 billion. It is estimated that businesses in the EU paid more than Euro 25 billion in fees in 2005. It is estimated that cards alone account for up to 25 per cent of retail banking profits.

The attached feedback form consists of three main parts.

  • The first part is designed to collect general identification information on respondents. The Commission may use the contact information of respondents in case it has to ask for any clarifications of the submission.
  • The second part of the feedback form will provide a lay-out for respondents to address specific questions raised in the interim report.
  • The third part will invite respondents to provide answers to five short questions to assess their overall degree of satisfaction with the content and format of the interim report.

    The final report on the sector inquiry into retail banking, covering current accounts and payment cards, will be published by the end of 2006.

    Deadline for consultation is 1 June 2006.

    Press release
    Interim report
    Feedback form
    Further Information

    © European Commission

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