Table of Contents
- Overview
- Catalyst
- Summary
- Methodology
- Table of Contents
- Table of figures
- Table of tables
- Regulatory Developments in the UK Payment Card Market
- The UK card market continues to face regulatory intervention at the
national level
- The Banking Code was revised in March 2008 following OFT' s call for
greater information to be provided with credit card cheques
- The consultation on the issue of credit card cheques by relevant parties
involved began in November 2005
- Datamonitor Cards and Payments Team view 7
- Store card providers have begun to reduce default fees but the OFT' s
investigation into overdraft default fees may still have further implications
for issuers 7
- Datamonitor Cards and Payments Team view 8
- The CCA 2006 has extended protection offered to consumers and was enacted
in April 2008
- The focus of CCA concerns provision of information to consumers
- Datamonitor Cards and Payments Team view
- The Competition Commission published its provisional findings on the sale
of payment protection insurance
- The investigation into PPI started when the OFT referred its report to the
Competition Commission
- The FSA has been independently investigating the sale of PPI since 2005
and has imposed penalties on several players
- Datamonitor Cards and Payments Team view
- The Payment Systems Task Force was wound up in November 2006 and replaced
with the UK Payments Council
- The work of the PSTF covered access and governance of the LINK ATM network
- The PSTF did not pursue its investigation into the access and governance
of UK card schemes
- The OFT has vowed to continue its investigations into multilateral
interchange fees but no progress has been made at the national level
- Background to interchange and its regulation
- Interchange is one of five key revenue streams for the industry
- Merchants are behind the downward pressure on interchange
- Interchange is a hugely important source of revenue for issuers in the UK
- The OFT' s current interest in domestic interchange began when MasterCard
applied for an exemption from the UK Competition Act 1998
- In its September 2005 ruling, the OFT accepted the need for a collective
agreement on interchange, but objects to what it sees as ' extraneous costs'
- In response to this finding, MasterCard, backed by the rest of the
industry, lodged an appeal with the CAT
- Datamonitor Cards and Payments Team view
- The UK card market also continues to face regulatory intervention at the
international level
- At the European level the EC came down against MasterCard' s intra-EEA
multilateral interchange fees
- The EC also found that MIF might stand in the way of the creation of SEPA
- Understandably, MasterCard appealed the European ruling on interchange
- The European Commission also initiated formal proceedings against Visa
Europe
- Visa is ready to negotiate a settlement with the EC regarding its
cross-border MIF' s
- Datamonitor Cards and Payments Team view
- The European CCD promises to make further changes to regulation in the UK
- The changes that have been made to the calculation for the APR will see
headline rates rise in the UK
- Timeline of the directive
- The revised proposal has seen changes to a number of key areas, but the
commitment to maximum harmonization in some areas remains
- Other areas of the directive remain unchanged from its previous form
- Despite positive intentions there are key problems with the directive
- Datamonitor Cards and Payments Team view
- The European banking industry continues to work towards the creation of
SEPA
- For a number of years the EC has pushed to create a single payments area
- Yet the threat of further regulation pushed the industry to take steps to
self-regulate
- At the end of 2004, the EPC issued a roadmap to 2010
- However, there are signs that regulators are becoming frustrated with the
slow progress of the banks in regards to SEPA
- In March 2006, the EPC published a second version of its Cards Framework
- After missing the original deadline, banks have agreed a new SEPA start
date
- Datamonitor Cards and Payments Team view
- Appendix
- Definitions
- AAGR
- APACS
- Average transaction value
- Balances outstanding
- CAGR
- Charge card CAGR
- Credit card
- CVV
- Debit card
- EMV
- Fraudulent use of card details (card-not-present fraud), also known as
fraud on phone, mail order or Internet transactions
- Interchange
- Non-standard
- OFT
- Methodology
- Primary research
- Secondary research
- Further Reading
- Ask the analyst
- Datamonitor Consulting
- Disclaimer
List of Tables
- Table 1: Current relevant Datamonitor publications, 2008
- Table 2: Future relevant Datamonitor publications, 2008
List of Figures
- Figure 1: Organization chart of the EPC, 2006
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