Brussels, 25/07/2001 (Agence Europe) - Associations representing European banks immediately denounced the draft regulation that the European Commission adopted on Wednesday to align the cost of cross-border payments on those of national operations (see yesterday's EUROPE, p.6). In separate press releases, the European Banking Federation (FBE), the European Association of Co-operative Banks (EABC) and the European Savings Banks Group use the same arguments to accuse the Commission of wanting to artificially set prices for a financial service. "The regulating authorities would replace market forces to fix the price", says, for example, the EACB. "Such a regulation would be a price regulation with no legal basis whatsoever in the EU treaty", notes Murizio Sella, President of the FBE, in a letter to Commission President Romano Prodi.
In addition, the price for cross-border transfers would be "frozen", which would not induce banks to improve their offer for this type of payment, Mr. Sella goes on. "It has taken decades to develop the efficient payment systems that we know at national level. It is not realistic to expect that the same level of efficiency can be reached for cross-border payment systems in the space of a couple of months", added the Secretary General of the EACB, Herve Guider. The Commission's proposal "might force some banks to withdraw from the cross-border payments market", say the savings banks.
Finally, the banks are furious at having been accused by Commissioner Frits Bolkestein of having done nothing in eleven years to improve cross-border payments. They stress that 9,000 banks notified an arrangement to the Commission in June that sets at 3 euro to cost of an inter-bank commission (Multilateral Interbank Fee - MIF) for all automatic cross-border transfers, and set a commission "lower than the current level", remark the savings banks. Yet, "the Commission ignores this important step and decides to regulate cross-border payment prices itself", note Mr. Sella.