Infotech

Spanish banks cautious on pan-European payments project



Posted on Dec 15, 2019 2021 at 6:12

A single European payment system, okay, but not at any cost. This is the message sent in recent days by Spanish banking circles, as the countdown has started to finance the European Payments Initiative (EPI). The 22 participating banks (French, German, Spanish, Dutch, Belgian, Polish and Finnish) are called upon to sign a commitment of 1.4 billion euros by December 22, with the ambition of starting up in 2022 .

In Spain, reluctance is palpable in the face of the size of the investment required, but also in the face of the project architecture. If all the banks immediately display a message of support for the initiative, those familiar with the matter are more nuanced. They signal that there are still many parameters to adjust before sealing the deal. The question is also to know what will ultimately be the place of the Spanish players. Indeed, for some, the initiative seems tailor-made for French and German banks.

PPE before the letter

As for the Spanish banks, the interest in EPI is however undeniable. The proof is that they are all present around the discussion table, namely CaixaBank, Santander, BBVA, as well as the consortium led by Sabadell which brings together small players in the national market. Their shared interest is nevertheless to highlight the efficiency of the common payment system already in place in Spain, and to know how it can be integrated into the new European framework.

A sort of PPE before the letter, the Bizum mobile payment platform was indeed launched in the Iberian Peninsula in October 2016, to occupy the field before the arrival of the payment systems of the digital giants. It was conceived and financed by the alliance of the big national banks before being extended to the whole sector.

It has found strong support and is now close to 20 million users, in a country of 47 million inhabitants. It is used for payments between individuals, for online purchases, and has more recently spread to shops, in the context of the pandemic.

Future of Bizum

Bizum is an indisputable success. But can it be integrated into the future European system? “The strategic vision of the EPI is shared, but all the players do not have the same approach”, describes one observer.

“The Spanish banks have already built a system that works and they have no interest in giving it up. For them, the question is to be able to articulate it within the new project. In other countries, the stakes are different, it is a question of making EPI a tool to renovate payment systems which are losing market share in the face of technological giants and it will be easier to migrate to the European solution. “

Governance doubts

In addition to these differences, there are doubts about the governance of the project and the weight that Spain will have against France and Germany in making its point of view heard. “The whole question is to know what we have to gain there”, summarizes a close to the file.

If things were not released in a favorable way, the Spanish banks could, according to him, withdraw and decide to join the system a posteriori by becoming users without necessarily having financed it from the beginning.

“We could perfectly decide not to migrate until we have the assurance of the stability and acceptance of the new payment platform,” he adds. Especially since the urgency is relative, he points out, since 90% of transactions take place within the same country.

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