Apr 24, 2008

Where is SEPA taking us? Will there be a third debit card scheme in Europe?

Charles Bryant, of the EBA got this question from the floor at today's Digital Money Forum: "Will there be a third debit card scheme in Europe?"

Answer: "My gut feel is that yes, there will be. It will be a simple debit card, with an acceptance brand, and will combine all of the national brands that exist today. But everything is frozen right now, due to things like interchange uncertainties, the current economic climate, and so forth. The jury's still out, but my gut feel is that yes, there will be a European debit scheme."

The idea of a European debit scheme competing with Visa and MasterCard is a very emotional subject, and the comments here kind of highlight that. At a gut level, yes, many Europeans would like to see such a scheme. But on a cold, pragmatic, business level, it is harder to see how to justify such a brand. What pain would a third brand address? Whose pain would that be? This is not clear to me at all.

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