European banks are under pressure to make quick progress towards creating an integrated payments system, or face a system imposed by the European Commission.
The European Central Bank has set a target of 2008 for the industry to converge national debit card schemes and implement a single European payments area (SEPA).
The banks' self-established body, the European Payments Council, has responded to increasing pressure from regulators by pledging to deliver its proposal to the ECB by June.
The blueprint will apply initially only to the dozen countries in the eurozone, but will be extended to cover all 25 European Union countries, which are represented on the banks' 65-member council. Regulators want common rules, enabling all debit merchants to accept international debit cards, but are also keen to see competition in the payments market.
This month, Charlie McCreevy, the EU's Internal Market Commissioner, warned banks that if they did not make urgent progress on the matter Brussels would issue legislation. He lamented that the 2008 target for achieving a single payments area would not be met at the present pace of change. Mr McCreevy said: "If necessary, the Commission will make some agreed industry standards mandatory and include the road map for the single payments area in our draft legal text."
Marc Temmerman, the executive vice-president of Visa Europe, said the 2008 deadline brought forward from 2010 was "very tight". He said: "They have raised the bar for the banks" adding that pressure the threat of undesirable regulation was needed to get the industry moving.
MasterCard and Visa have stepped up their campaigns in support of a single payments area, holding up their competing Maestro and V Pay debit card platforms as models. Maestro has operated for 12 years, while Visa launched V Pay in November to provide a SEPA-compliant offer.
Mr Temmerman said Visa had seen a "positive reaction" when it presented V Pay to the ECB and the Commission, but stressed: "They want to see competition. It's just one offer."
Meanwhile, Alexander Labak, the president of MasterCard Europe, noted that Brussels was concerned about the lack of progress. "By this summer, our industry needs to achieve a blueprint for a single European payments area that embraces freedom of choice." He noted that three years after the launch of the euro, for debit cards there are in effect still "plastic guilders, francs, marks, lire".
Cash accounts for more than 70 per cent of transactions in Europe. Research has shown that a move to replace cash with plastic could improve the efficiency of the European economy by up to ¤50bn (£35bn).Reuse content