Lawmakers must act to save SEPA: ECB official
Europe's plan to create a true single market is threatened unless lawmakers step in, a top European Central Bank official said on Monday.
"A legally binding instrument is from my point of view necessary" to ensure the future of the Single Euro Payments Area (SEPA), "as the project would otherwise face the risk of failure," ECB executive board member Gertrude Tumpel-Gugerell said.
SEPA is a direct debit programme which enables companies and individuals to make standardised monthly euro payments in 32 countries from a single bank account.
Beneficiaries include mobile phone companies, energy or telecommunication suppliers, petrol station chains and individuals with monthly payments who should find the process easier and cheaper if market competition is spurred as the ECB hopes.
The programme is a key building block for the eurozone, which is to gain its 17th member in January with the addition of Estonia.
Although an EU estimate has put potential savings from SEPA at 18 billion euros (24 billion dollars) per year, so-called migration of banks to the project "has been very slow," Tumpel-Gugerell told a conference in Brussels.
Copies of her speech were distributed in advance.
"We see that the migration to SEPA in a self-regulated way has not acheived the required results," she said, with the project now covering just 8.8 percent of all eurozone credit transfers and 0.05 percent of direct debits.
The banking industry's self-imposed deadline of December 2010 for generalised use of the programme "will not be met," the ECB official said.
A final date for the switchover to SEPA credit transfers and direct debits "is necessary and should be set by the EU legislator," she concluded.
© 2010 AFP