SEPA Success Subject to Incentives from Regulators
It is unlikely that a critical mass of SEPA payment instruments will be achieved by the end of 2011, unless regulators provide incentives to mobilise European public administrations and corporations to adopt the new SEPA instruments. This is a key finding of the World Payments Report 2007, published by Capgemini, ABN AMRO, and the European Financial Management & Marketing Association (EFMA). The report, now in its third year, considers world payments trends, with a particular emphasis on developments towards SEPA in Europe. “Reaching a critical mass of SEPA credit transfers and direct debits quickly is key to keeping payment costs down and managing the revenue impact of SEPA and of the Payment Services Directive,” commented Bertrand Lavayssière, Capgemini’s managing director of global financial services. “For banks, slow adoption translates into increased costs as a result of maintaining both legacy and new payments services.” The report suggests that, to stay competitive in the new payments landscape, banks will need to reassess their operating models in Europe, and may choose one of three strategies – niche player, low cost producer or industry leader – and it goes on to suggest that many banks will need to outsource at least part of their payments activities.