EAPS to challenge SEPA
The founding members of the not-for-profit company include Germany's electronic cash, Spain's EURO 6000, Portugal's Multibanco, The UK's Link Interchange Network, Italian card schemes PagoBancomat and Bancomat and European card payment processor Eufiserv. Other domestic debit schemes and financial institutions have been invited to join the newly created consortium. The newly formed company, called "Euro Alliance of Payment Schemes" (EAPS) will be based in Brussels, Belgium and aims at enabling direct pan-European acceptance of debit cards without the need for an intermediary processor.
The members have established a rule set for cross border transactions processing, which is currently under review by the European Commission and the European Central Bank. Pilots for cross border debit processing are already taking place between Germany and Italy, Spain and Portugal and Spain and Germany. More tests are expected in the second half of 2007.
The SEPA (Single Euro Payment Area) directive mandates that cross border payments should be processed the same way, and bear the same cost as domestic payments in European countries. This can be achieved either by abandoning the domestic programs and replacing them by international programs or by linking together existing national programs. EAPS establishment is the demonstration the second option may prevail and a way to challenge the domination of Visa and MasterCard.