European Commission approved a proposal for euro instant payment acceleration. Europeans have the technology and should be able send and receive funds immediately. The executive body stated that it intends to encourage widespread adoption.
EU moves to make instant payments widely available throughout Europe
A legislative proposal to provide all citizens and businesses with access to instant payments in Europe’s single currency has been put forward by the European Commission. Officials made clear Wednesday that payments must be accessible to all citizens and businesses with bank accounts in both the European Union (EU) and European Economic Area.
Instant payments are much faster than traditional transfers and increase convenience for consumers, save costs for companies, and will free up to €200 billion ($199B) currently locked in transit every day for consumption or investment, the executive power in Brussels argued. Their widespread adoption is the goal of the Commission.
Valdis Dombrovskis (Executive Vice President for an Economy That Works For People) commented on the initiative. She stressed the importance of instant payments for Europe’s ability to be competitive in today’s digital world. However, nine out of ten credit transfers in euro are still processed as ‘slow’ transfers, pointed out Mairead McGuinness, commissioner for financial services, financial stability and Capital Markets Union.
McGuinness said that the change from next day transfers to transfer in seconds was likened to the switch from mail to email. McGuinness is certain that there’s no reason why European businesses and citizens should be prevented from sending and receiving money instantly, as the technology is in place since 2017. As it might take another decade for instant payments to become the norm, “we are nudging this sector in this direction,” the commissioner stated during a press conference.
The proposal amends the Regulation on Single Euro Payments Area. Payment service providers who offer credit transfer services will have to be able to accept instant payments and charge fees not higher than traditional euro transfers. A bank account, beneficiary name, and client sanction will all be checked by them.
According to the European Commission, the new changes will increase the competition on the payment market. The proposal was made by the eurozone financial authorities, who are currently working on a project that will issue a digital copy of the common European money. The European Central Bank’s top officials indicated in July that easy use and wide acceptance would be key features of the digital euro.
What do you think about the European Commission’s decision to promote instant payments in euro? Please comment below with your opinions.
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