Could regulation stifle m-payments?

September 30th, 2011 by · Leave a Comment

This article was authored by Michael Carroll, and was originally posted on

Plans by the European Commission to probe bank’s efforts at self-regulation for electronic payments contain a stark parallel with comments by Three UK about its rival’s plans for an m-payment consortium.

The word ‘exclusion’.

The Commission’s plan to investigate if Electronic Payment Council (EPS)standards breach competition rules is specifically intended to assess whether the specs will exclude new entrants or those not backed by major banks. The EPS is the payment policy making body of European banks, and has developed standards even the EC admits are essential to promoting a single market across the region.

However, the investigation also shows that the commission’s ears have been pricked up regarding online payments. You have to wonder at the timing, given Three UK recently had a quiet word about O2, Vodafone and EverythingEverywhere’s plans for a mobile payments joint venture.

The move also comes less than a week after Google hit the headlines with its m-payment service.

EC competition vice president Joaquín Almunia played down the significance of the EPS probe. He welcomed the body’s efforts to self regulate, and noted that standards typically boost competition. There was a ‘but’, though. “[W]e need to ensure that the standardization process does not unnecessarily restrict opportunities for non-participants.”

We do, genuinely, finally, seem to be on the brink of a world enabled by NFC technology, and as the TM Forum’s tech evangelist Tony Poulos notes big banks are already geared up with inter-industry agreements and deals.

The question is, though, will regulators now stem the progress of e-payments as they probe those relationships, or will they take a cursory glance and let the industry grow on its own?

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