European Card Market 2011 Update

New Research Report by Mercator Advisory Group overviews the European Card Market in the context of the SEPA initiative

Boston, MA –The European migration from existing payment services (following the first Single Euro Payment Area (SEPA) Credit Transfer (SCT) three years ago) has not met regulator expectations. Despite the far-reaching impacts of SEPA and increasing regulatory pressure, the European payments industry has been slow to take action. Meanwhile, stakeholders remain unaware (or unconvinced) of the benefits of replacing their current services with the new payment platforms. This environment has prompted regulators to begin enforcing legal deadlines for the completion of the migration to SCT and SEPA Direct Debit (SDD).

The situation is similar for payment cards. Uncertainty remains around multilateral interchange fees (MIF) as well as emerging European card schemes. Regulators have not yet issued MIF guidelines for the various card schemes, despite the EC’s separate agreements with Visa Europe and MasterCard. In addition, there are concerns that the SEPA Card Framework (SCF) might not be addressing market need for emerging payments.

“The European payments market is in a challenging situation,” Terry Xie, Director of Mercator Advisory Group’s International Advisory Service and principal analyst on the report, commented. “The market continues to evolve even with the uncertainty surrounding SEPA. But it is apparent that the current state is not ideal for the industry to commit to new payment services or to make the investments needed to create an integrated European market. Although regulators want to force the process forward, their lack of clarity on key issues holds progress back. Ambitious players would be wise to continue carrying out their strategic plans rather than adopting a just ‘wait and see’ mindset.”

Mercator’s latest report, European Card Market 2011 Update, overviews the European Card Market in the context of the SEPA initiative. The first half of the report discusses Europe’s migration to SEPA Credit Transfers and Direct Debits, the status of the MIF dispute, and the progresses (or lack thereof) of emerging European card schemes in obtaining issuers, merchants, and consumers. The report’s second half surveys the current European payment card market, including the activity of major card networks, processors, issuers and acquirers over the past years as SEPA has slowly moved forward. The report also reviews SEPA’s impact on emerging payment trends in the European market including alternative, online, and mobile payments, among others.

Highlights of the research findings include:


State of the Single Euro Payment Area migration process, and the factors influencing the banking industry’s promotion of the new services.

Reasons regulators are determined to force change.

Industry dynamics obstructing progress towards implementation in the card market.

Areas of the payment industry that are witnessing progress and the reasons why.

Market segments building their capability to recap market opportunities once SEPA becomes a reality.


One of the seven exhibits included in this report:


This report contains 27 pages and seven exhibits.

Members of Mercator Advisory Group have access to this report as well as the upcoming research for the year ahead, presentations, analyst access and other membership benefits.


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About Mercator Advisory Group
Mercator Advisory Group is the leading, independent research and advisory services firm exclusively focused on the payments and banking industries. We deliver pragmatic and timely research and advice designed to help our clients uncover the most lucrative opportunities to maximize revenue growth and contain costs. Our clients range from the world’s largest payment issuers, acquirers, processors, merchants and associations to leading technology providers and investors. Mercator Advisory Group is also the publisher of the online payments and banking news and information portal