More Europe often means less Netherlands. Some hate that and are even a bit afraid of it. Others are happy with the progress. The next victim of this progress will probably be our debit card. Sacrificed for SEPA. First our account number will change as a result of Sepa, when will the other changes follow? Will Maestro conquer the Netherlands?
The rejection of the European Constitution on June 2005 cannot be seen separately from the feeling that Dutch identity is increasingly in danger of disappearing. The feeling that Europe decides and the Netherlands must go along. Well, the euro often makes paying abroad easier, because you no longer have to exchange your own currency within Europe. But the question remains whether citizens will be so happy with all the financial decisions from Brussels. For example, I recently wrote about the new European payment system, SEPA. What does that mean for our debit card?
The debit card is fully accepted in the Netherlands. To give an idea, currently more than 90% of electronic payments in our country are made with the debit card. That’s not surprising. Apart from the costs for the card, debit card costs the consumer almost nothing. However, the fortunes of the debit card will change with SEPA.
Already there are external changes. For example, a different way of paying and withdrawing money has already been introduced in countries such as France, Germany, Spain and England. Due to new European requirements, you no longer have to swipe your debit card at the payment terminal in the store to read the magnetic stripe and carry out the transaction. You must insert the debit card into the machine so that an EMV chip on it can be read. This is not yet running smoothly. For example, not all ATMs and payment terminals in Italy are suitable for the new chip. And that can sometimes be difficult on holiday.
A few years ago we talked about the Europe of two speeds. Now that is no longer so politically correct, because Europe does not want to radiate division. But there are indeed major differences in the payments market. For example, calculations by the ECB indicate that a Spaniard pays no less than 75 euro cents in transaction costs for a PIN transaction of 45 euros and a Frenchman pays more than 30 euro cents. For comparison: for a comparable payment with Maestro from Mastercard you still pay 40 euro cents.
There are many banks in Europe and therefore many debit cards in use. In the near future, not only will consolidation in the banking sector likely continue, but the number of cards will also be reduced. There will be a need for one or more European debit cards instead of the range of cards that currently exist. The introduction of EMV chip technology on our debit card is an intermediate step to comply with the European security standard. The battle of the cards has yet to start. The question is who will win and what it will cost. From the above it became clear that our debit card is cheap from a European perspective. At the same time, it is clear that the Netherlands is a relatively small player. The chance that our debit card will become the standard is minimal. Major American players such as Maestro and V Pay are currently eyeing the European payment and credit card market in order to gain a much greater influence there. And that seems to work.
Belgium is a forerunner on this point. The Belgian banking sector has decided to replace the well-known Bancontact/Mister Cash, BC/MC, with Maestro from 1 January 2008. Others may be added later. But the tone has been set and Maestro has already increased its rates. Everyone will also receive a new European account number with eighteen characters.
According to the banks, SEPA also offers many advantages. In addition to easier international banking, a foreign account is often no longer necessary. The importance of a credit card is decreasing and the new EMV chip is more fraud-resistant. A PIN code would also no longer be necessary.
Since 2008, all this has been joined by the credit crisis and in 2015 by the crisis in Greece. The question is to what extent banks will still be in a hurry with SEPA.
Currently, 31 countries have to work with SEPA: the 27 countries of the European Union, Switzerland, Iceland, Liechtenstein and Norway. It remains to be seen how quickly this will work and what the exact outcome will be. In 2015, the debit card still exists, but our account number has been sacrificed to the iban code. In any case, it doesn’t seem to be getting any cheaper for us.