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Brussels, 20th September 2001

Cross-border payments: New Commission study confirms persistent high charges - September 24 conference

Banks and credit institutions in the European Union still charge excessive fees for low-value cross-border credit transfers within the EC and a large number of these transfers are subject to unauthorised double charging. These are the main findings of a new study undertaken for the European Commission. The study examined 1480 credit transfers of €100 throughout the European Union, a larger sample than the study published in July. Whilst the results on average delays for transfers are quite satisfactory, the study shows that customers are given insufficient or no prior information by their banks about the costs of transfers, that there is still a high percentage of unauthorised "double charging" and that the average cost of cross-border credit transfers has remained virtually at the same level as 1993 when a comparable study was undertaken, with an average charge of €24.09 for a transfer of €100. Banking charges will be a core issue at the 24th September Conference on "Payments in Euro in the Internal Market" in Brussels. Speakers will include Commission President Romano Prodi, Internal Market Commissioner Frits Bolkestein, Economic and Monetary Affairs Commissioner Pedro Solbes, Belgian Minister for Economic Affairs and current President of the EU's Council of Internal Market Ministers Charles Picqué, European Central Bank Executive Board Member Tommaso Padoa-Schioppa and Karla Peijs MEP. For further details of the study, see MEMO/01/294 and the Europa web-site: HYPERLINK """The results of this new survey are very disappointing" commented Frits Bolkestein. "The survey clearly demonstrates that in far too many cases customers are not receiving the information on charges to which they are entitled under the Directive and that there is still too much unauthorised double charging. Moreover, the fact that the level of charges has hardly changed since the Commission's directly comparable survey in 1993, despite repeated claims from the banking sector that they would act decisively to reduce these costs, clearly demonstrates that the Commission has no alternative to proposing legislation to require banks to levy the same charges for cross-border and domestic payments." "Once European citizens have euro banknotes and coins in their purses, they will understand and accept these high charges even less" added Commissioner David Byrne, responsible for Health and Consumer Protection.

The study clearly indicates that - despite repeated appeals of the European Commission and despite the pending introduction of Euro banknotes and coins the level of charges for cross-border payments remains at an unacceptable level. This situation prompted the recent Commission proposal for a Regulation on Cross-Border Payments in euro, which will oblige banks in all Member States to levy the same charges for cross-border and domestic payments (see IP/01/1084 and MEMO/01/279). The proposed Regulation aims at a reduction of charges for cross-border payments of up to €50.000 in euro, so that by 1 January 2002 (concerning electronic payment transactions), respectively by 1 January 2003 (concerning cross-border credit transfers and cross-border cheques) charges would be aligned to those for corresponding payments at national level. This action is part of the Commission's strategy for retail financial services. The Council and the Parliament of the European Communities will discuss this proposal during autumn of 2001.

Commission calls for improvements since 1990

For more than a decade the Commission has urged the banking industry to make the necessary investments for efficient and automated (hence cheaper) cross-border payment systems. The Commission's Communication of January 2000 on "Retail Payments in the Internal Market" (IP/00/108) re-assessed the state of affairs and concluded that the situation of cross-border payments within the Internal Market was still not satisfactory. Concrete measures were enumerated in order to create by 1/1/2002 a true and functioning "Single Payment Area".

In its Communication of 3 April 2001 "Report on the preparations for the introduction of euro notes and coins" the Commission again noted the lack of progress in creating the Single Currency Zone for non-cash means of payment and announced that it would "consider using all the instruments at its disposal and will take all the steps necessary to ensure that the costs of cross-border transactions are brought more closely into line with the costs of domestic transactions on 1 January 2002".

Seeking redress

The Commission urges customers that encounter problems with cross-border payments, to make systematic use of the Alternative Dispute Resolution schemes in their countries and to address to these bodies any complaints they could not settle with their banks. An EU-wide cross-border out-of-court complaints network for retail financial services (FIN-NET) was launched by the Commission in February 2001 (see IP/01/152). This co-operation network is the first operational cross-border ADR system at Community level. The full list of the FIN-NET out-of-court redress bodies is available on the Europa web-site at:

24th September Conference

The Conference is the follow-up to the Round-Table entitled "Establishing a Single Payment Area: State of Play and Next Steps" held on 9 November 2000. Last year's event concentrated on taking stock of progress, discussing concrete projects and identifying the work still to be undertaken. At this year's conference, however, the speakers will present how in practice payments in euro will be carried out as of 1 January 2002, they will explain how the systems and means of payment in euro function and discuss the proposed Regulation on cross border payment in euro. Various speakers will present how the various means of payment (transfer, card, automatic teller machine (ATM), electronic purse and direct debit) will work in euro.

The Conference will take place in the European Commission's Charlemagne building in Brussels (rue de la Loi, metro Schuman). Journalists accredited with the Commission are welcome to attend the conference on production of their press card.

Further details concerning the conference are available on the Europa website:

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