Fabian Demicoli

Stop card-based payment abuse


On 11 December, the EESC plenary
session backed the Commission's proposals on card-based payments, but wants EU
citizens to be able to make basic electronic payments cheaply and easily over
the internet, both nationally and across borders.

Debit cards, credit cards and all manner of
mobile and electronic payment schemes are coming to dominate trade, but EU
regulations on payments have struggled to keep up with the rapid pace of
change. "The argument on how to start dismantling the high cost structure
imposed by the card payment services that dominate the plastic money market has
been going on for far too long. In addition, the same cost structure is rapidly
becoming more frequent in mobile payment services", said Vincent Farrugia
(Employers Group, Malta), rapporteur for the EESC opinion on Payment services.

Lower interchange
fees

The new payments package, which introduces a
cap on interchange fees and updates, will go some way towards improving
transparency and security, removing national divergences and aligning legal
rules in the payment system.

However, the Committee recommended that caps
for both credit and debit payments be lower than those proposed. Furthermore,
scrapping interchange fees altogether for debit cards would further open up
e-commerce in Europe and benefit consumers and the economy. "Capping
interchange charges should be made effective immediately for payments using
credit cards and debit cards in the domestic market, and not merely for
cross-border purchases", adds Vincent Farrugia.

The EESC also wants to include the same level
of caps for commercial or business cards.

 

Safer online shopping

More and more internet users in the EU are
shopping online. However, only 9.3% of traders actually sell across EU borders,
and 44% of Europeans say they do not buy abroad because they are uncertain of
their rights. Payment costs and delivery problems, as well as legal and
security concerns, are holding internet business back. The EESC believes that
the new proposals will mean shoppers get better, cheaper internet payment
services with less risk of online fraud and disputes.

These new proposals will also promote the
emergence of new players and the development of innovative mobile and internet
payment systems. The proposals also strengthen consumer rights on international
money transfers. EU payment laws should not just respond to today's market
needs, they should also look ahead to the coming years.

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