Michel Barnier, the European commissioner for the internal market and services, and Joaquín Almunia, the commissioner for competition, are to launch a consultation on e-payments next week (11 January). It is likely to say that growth and competition are being held back by transaction fees and by fragmentation of the cross-border payments market.
The number of online shoppers in Europe is expected to soar over the next three years, but the Commission believes that progress is still impeded by complicated payment methods and differences in the way payments are organised between member states. The e-payments green paper, a draft of which has been seen by European Voice, will also question to what extent fears over data security are preventing people from fully embracing internet payments.
The consultation, a precursor to probable legislation, is intended to identify improvements needed to bring about further integration of internet, card and mobile phone payments.
The draft suggests that the Commission will once again take aim at multilateral interchange fees (MIFs), the fees that banks charge each other when a card transaction takes place. The Commission has frequently criticised the practice over recent years, claiming that it restricts competition.
It believes that the current level of MIFs may act as barriers to entry for low-cost card payment systems, and hinder the development of other forms of internet and mobile payments. The consultation will explore whether there is support for lowering fees.
Other areas to be tackled by the green paper include increased standardisation of e-payment and mobile-payment technology to ensure full interoperability between different devices, and what extra security processes should be required to authorise payments.