Brussels, 26/03/2009 (Agence Europe) - The European Commission and European Central Bank (ECB) have finally reached agreement. Following an initial joint statement in September 2008 (see EUROPE 9733), on Tuesday 24 March 2009 they repeated their view that the multilateral interchange fee (MIF) should be allowed on a temporary basis (from November 2009 to 31 October 2012) to fund the introduction of national and international direct debit systems (to pay a bill in one country by direct debit from another country, for example) in the Single European Payment Area (SEPA). The MIF will not be charged by the bank of the consumer making the direct debit but instead by the bank of the company receiving the payment.
“Direct debits represent an efficient and convenient way for debtors to pay their bills. However, many of the benefits of the use of the direct debit as a payment instrument are on the creditor's side (i.e. cost savings by electronic payments handling, increased certainty of payment, better liquidity management etc)... Creditor companies have effective means to directly encourage customers to make use of direct debit, in particular by granting rebates. Due to the availability of such a direct way of promoting efficient consumer use of direct debit, it appears neither necessary nor efficient that banks apply a collective, indirect mechanism in the form of a general per transaction multilateral interchange fee paid by creditor banks to debit banks,” explains the ECB in a press release. MIFs would be authorised during a transition period until the end of October 2012, when they would have to be replaced by other mechanisms at both national and international level. The current negotiations to revise the EU cross-border payment rules (Regulation 2560/2001/EC) will provide an opportunity for further legal clarity in this field, explain the Commission and ECB (see EUROPE 9762). Neither organisation rules out multilateral invoicing agreements to encourage participants to reduce their margin of error and share the cost of payments made in error.
In a press release, EU Competition Commissioner Neelie Kroes said the Commission would ensure that the SEPA is subject to effective competition to ensure that the benefits of national and cross-border SEPA direct debits are shared fairly among consumers and companies. The MIFs can be used by banks in countries where they are authorised to generate income at the consumer's expense. The 'Fédération des Banques Françaises' (FBF) is challenging the Commission's decision to allow MIFs because it says it does not say how much users would be charged but instead defines business rules for banks so they can decide in a free and transparent manner how much the provision of direct debits will cost them, a cooperative system that guarantees universal, efficient and safe payments. The FBF warns that the decision will encourage banks to earn income in other forms, possibly to the expense of consumers, and slow down migration to a SEPA direct debit system. (M.B. trans fl)