EU harmonises cross-border electronic bank transfers

15 Oct 2008

Bank transfers within the EU are soon to cost the same as domestic transfers, Internal Markets Commissioner, Charlie McCreevy, said today.

The European Commission today put forward a proposal modifying the provisions and extending the scope of the 2001 Regulation on cross-border euro payments.

Under this extention, cross-border bank transfers in euro within the EU will cost the same as domestic transfers.

The proposal comes in response to the rapid evolution of the EU payments market. It aims to extend the principle of equality of charges to direct debit payments. It also contains some provisions enhancing the protection of consumer interests and rights, and alleviating the statistical reporting burden.

“It is essential in an integrated payment market to ensure that payment users see no practical difference between domestic and cross-border transactions,” Commissioner McCreevy said.

“This new proposal is a natural complement to the progressive creation of a Single Euro Payment Area, which should provide significant savings and benefits to European consumers and businesses.”

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The proposal extends the principle of equality of charges to direct debit payments, which will become available on a cross-border basis from November 2009.

As is already the case with credit transfers, ATM cash withdrawals and card payments, the cost of a cross-border direct debit in euro will become the same as the cost of a national direct debit.

The proposal also provides for the setting-up of out-of-court redress bodies responsible for solving disputes related to cross-border payments, thereby enhancing the protection of consumer rights in this field.

The proposal also aims at phasing out certain statistical reporting obligations relating to balance of payments, thus alleviating administrative and financial burdens, and facilitating the implementation of the Single Euro Payments Area.

The new regulation, if agreed upon by the European Parliament and the Council, would replace the existing text from 1 November 2009.

By John Kennedy

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years

editorial@siliconrepublic.com