Proximity fund transfer: large retail distribution challenging bank card payment
- Large retail distribution players want to develop a mobile-based proximity fund transfer pilot test by February 2011. This system aims to propose an alternative to bank card payments using new SCT format fund transfer. This test would make it possible to process each transfer in real time. The merchant's bank does not have to intercede to validate the transaction, and there are no interbank commissions.
- 100 million Euros investment would be necessary to develop this mobile signature-based kind of transfer.
- As this project shows, new SEPA-related payment instruments open new possibilities in the field of marketing innovation. Retailers do not want to pay interbank commissions any longer and, if successful, this project would de facto cause them to drop. For banking institutions, 1.3 billion Euros commission are at stakes. The necessary investments to set up this solution do not even represent 8% of this amount.
- Banks obviously stand back and debates are still raging. Some consider that card payment provides guarantees that do not exist in the case of fund transfers. Others deem that this guarantee becomes useless when transfers are performed in real time, and, according to banking players no infrastructure can guarantee real time transactions.
- The banking sector prefers to plan another proximity payment version, based on bank cards and already used in other European countries. This proximity transfer system consists in setting a list of recurring recipients with the bank and use an ATM to transfer funds. The proposed system then would be particularly suited to bill payments. The aim is of course to leave cheques aside, as customers do not have to pay for them and because their cost is passed on to the banks (61% of the cheques issued in Europe come from France).