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Protecting the efficient and universal interbank card model

Payment cards are n°1 method of payment for french customers. Yet, its model is undermined by some of the European Commission's projects of reform.

Payment cards are the No. 1 method of payment for french consumers, accounting for 45 % of transactions completed in France in 2011(1). They are easy to use for consumers because the interbank system facilitates the universality of payments, regardless of which banks clients and merchants use or accept them. Clients can use the same card to pay for their purchases at any shop. Payment cards are practical, guaranteed, safe and traceable payment instruments.

And yet, for the past several months, the European Commission has, based on an analysis of the future of payment instruments in Europe, considered reducing and possibly prohibiting multilateral interchange fees (MIFs) for payment cards. Should this happen, it would not merely be a minor adjustment of the economic model of payment cards, but would in fact broadly undermine payment card services. However, payment cards have become the preferred method of payment for the French and, what's more, they have paved the way for the development of innovative payment instruments (mobile payment, e-wallets, etc.).

MIFs are key to ensuring the sustainability of the card system

The interbank system operates collectively, with legal and technical rules applicable to all participants, and payment for services rendered by the client's bank to the merchant's bank. This system is well known to the French and European anti-trust authorities and ensures the sustainability of infrastructures in place as well as their adaptation to technological developments. Banks are constantly investing to further the development and increase the security of payment instruments, particularly in the interest of combating fraud.

For the French Banking Federation (FBF), it is vital to maintain a viable economic model to preserve the interbank universality of payment cards. If the interbank system goes, the universality of payments goes with it. Consumers would then need to have several different cards, depending on which cards are accepted by their merchants. Clients and merchants alike would both pay higher costs for using the cards, which would no longer be so easy to use.

An impact study is imperative

The FBF therefore asks that, prior to implementing any measures that might impact the economic model of interbank payment cards, a study be conducted on all payment instruments in Europe (payment cards, cheques, cash, etc.), comparing the direct and indirect costs, security and ease of use offered by each. Such a study is all the more important considering how quickly payment instruments evolve in response to technical innovations.


(1) source ECB Payment Statistics - September 2012


Colette Cova
email : ccova@fbf.fr
Tel : 01 48 00 50 07

Céline Meslier
email : cmeslier@fbf.fr
Tel : 01 48 00 50 70

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