Pressure on banks intensifies over eurozone instant payments
The European Commission has mandated instant payments across the eurozone, and banks must urgently ensure that their payment systems are fit for purpose.
In late October, the European Commission adopted a legislative proposal requiring eurozone banks to offer instant euro payments to any individual with a bank account in an EU or EEA country at a cost no higher than that for non-instant euro credit transfers.
This move was the culmination of three years of consultation and was prompted by the relatively low implementation of instant payments across the eurozone – with the commission acknowledging that around one third of EU payment service providers don’t even offer the service.
Banks realistically need around two years to make this happen
Katarzyna Kobylińska-Hilliard, a policy expert at the European Commission, observes that with an average uptake of around 13% in October 2022, the EU lags significantly behind other major international markets.
She says that while instant payments in euro have become the ‘new normal’ way of transferring funds in some member states where uptake hovers around 70%, in other countries – both inside and outside the eurozone – they account for less than 1% of payments made.