banks in the defensive mode

The European Banking Federation (EBF), the European Association of Co-operative Banks (EACB) and the European Savings and Retail Banking Group (ESBG) point out that the crisis has brought to the fore the importance of well-functioning payments services.

The three groups have put together their vision for payments in the EU over the next five years, as they “seek to meet changes sparked by a mix of evolving customer needs, regulatory action, technology and innovation, and increased competition”.

Top of the list of priorities is the importance of developing instant payments across the EU that allows for both the differentiation of EU companies and the reduction of dependency on the dominant non-EU payment card schemes.

But reading the document not one single word was mentioned about using  blockchain or distributed ledger technology. It seems banks are increasingly getting in the defensive mode worrying the disruptive impact of this technology on their business.

Some critical remarks

Looking into the report the focus is rather limited. It shows a rather isolated EU-oriented view. It does not take into account the new realities such as globalisation of the payments world, the upcoming of new technologies and the global role of organisations 
such as Visa and MasterCard, but also the likes of Facebook and Google.

It is too much EU but above all too much euro-area focused, while not taking into account the cross border element especially towards non-euro EU countries.

The report also does not go into more detail towards the various technologies including Big Data, Artificial Intelligence and above all blockchain.

Present state of EU payments market

But let us first look at the present state of the EU payments market. And what blockchain could mean to improve. As EU banks you cannot deny the outside world. I agree, most European domestic payment systems are pretty efficient. But not where one has to
transfer money cross-border, especially where it…

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