The European Payments Council (EPC), the
co-ordination and decision-making body of the European payments
industry, has published its 2009 annual report, which highlights
the “substantial progress” achieved in delivering several
initiatives for the Single Euro Payments Area (SEPA).

Among the initiatives highlighted is the SEPA
Cards Framework (SCF), which has been designed to enhance levels of
interoperability within SEPA by defining common standards in order
to improve transparency and remove barriers to the development of a
SEPA for cards.

In December 2009, the EPC approved version 2.1
of the SCF for publication, updating the version originally issued
in March 2006. In addition, the SCF was aligned with the Payment
Services Directive and European Commission regulations on
cross-border payments.

The EPC stated in its annual report that it is
considering the publication of a further revised version of the SCF
in 2010.

In response to changing customer habits,
significant progress was achieved in the design of the SEPA
e-Payments Framework facilitating online payments with a
paymentguarantee for online retailers followed by a SEPA Credit
Transfer.

In addition, the EPC Roadmap for
Mobile
Payments approved in March 2009 spells out the
main deliverables in the areas of SEPA card proximity payments and
SEPA card mobile remote payments.

Moving the focus to
mobile

According to the EPC, mobile payments will be
a key area of focus, given that the mobile channel is an “ideal
launch pad for SEPA payment instruments”.

The EPC is collaborating with mobile operators
and other stakeholders to establish the necessary standards and
business rules with regard to the initiation and receipt of credit,
debit and other card payments through mobile phones. The aim is to
establish proposals that are ripe for collaboration and
standardisation and which form the basis for interoperability.

The intention is to establish a service
framework sufficient to reach potentially all payers and payees in
the European Economic Area, and to create a trusted and secure
environment that multiple stakeholders can use to facilitate SEPA
payments initiated through the mobile channel in a convenient
way.

“At the same time, a common technical
interoperability and business framework will avoid market
fragmentation which would hinder the emergence of open,
non-proprietary technology standards for user-friendly mobile
payment services,” the report stated.

The EPC Roadmap for Mobile Payments
will cover SEPA card proximity payments for all usage cases except
person-to-person; SEPA card mobile remote payments for person-
to-business, business-to-business and person-to-person; and SEPA
credit transfer mobile remote payments in all usage cases.

The EPC added that significant progress is
also being made in relation to the development of contactless
near-field-communication (NFC) payments using mobile phones, “a
project which enjoys the highest priority”.

Also in 2009, the EPC – together with
representatives of the main sectors active in the cards domain
including retailers, vendors (manufacturers of cards, payment
devices and related IT systems), processors and card schemes –
established the Cards Stakeholders Group (CSG), mandated to
progress the use of open and free standards available to all
parties in the SEPA cards market.

EPC Chair Gerard Hartsink said: “The EPC
annual report for 2009 demonstrates the continued commitment of the
European payments industry to making SEPA a reality. The successful
conclusion of this harmonisation exercise requires action by all
stakeholders. The EPC welcomes the fact that the EU finance
ministers represented in the Economics and Financial Affairs
Council recognise that setting a deadline for migration to SEPA
provides the clarity and the incentive needed by the market; will
ensure that the substantial benefits of SEPA are rapidly achieved;
and that the high costs of running both legacy and SEPA products in
parallel can be eliminated.”