Thursday, March 27, 2008

EU report says cross-border payment rules should include direct debit transfers

BRUSSELS (Thomson Financial) - EU rules on charges for cross-border euro payments should be extended to include direct debit payments, according to a new European Commission report. In addition, it argues the rules should be revised to reduce the burden of statistical reporting for banks and cut the costs for cross-border bank transfers. The reports envisages a phasing out of the balance of payments reporting obligations imposed on banks in some member states, arguing such obligations 'hamper the development of the Single Euro Payments Area (SEPA)'. The obligations differ between countries and 'prevent fully automated processing of cross-border payments', which ultimately leads to higher costs for banks and consumers, according to the report. Placing particular emphasis on the protection of consumers, the report concludes all member states should set up a competent authority as well as out-of court redress procedures to deal with disputes between a bank and a customer or to flag up problems with the application of the rules. EU rules on cross-border payment have levelled fees for payments up to 50,000 eur into an account in another member state with those charged for payments made within a customer's home country.

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