Critical open letter “lack of dynamism” in payment methods in Portugal — DNOTICIAS.PT
Several companies and associations of merchants and payments and electronic money today issued an open letter in which they defend “there is a discouraging picture of lack of dynamism and diversification of means of payment in Portugal”.
In the missive co-signed by the National Association of Payment Institutions and Electronic Money (ANIPE), Confederation of Commerce and Services of Portugal (CCP), Association of Hotels, Restaurants and Similar Products of Portugal (AHRESP), Portuguese Association of Distribution Companies (APED) and SaltPay, the signatories say that the Portuguese market is “particularly disadvantaged when compared to other markets in the European Economic Area and the United Kingdom”.
The open letter compares the number of Payment Institutions and Electronic Money (IPME) licensed in Portugal (14) with other existing countries in the European Economic Area and in the United Kingdom, highlighting the latter (1,231), Lithuania (123) or France ( 85), on the one hand, and Belgium (34), Ireland (41) and Italy (57), on the other.
The letter criticizes the absence of an open payments ecosystem that promotes integration between systems and that “is invited to incorporate new IPME in Portugal”, which means that there is “an insignificant number” of these institutions with a physical presence, which turns out to reveal “serious deficiencies in the national payment market”.
This, they argue, has “undeniable consequences” for consumers, merchants, emigrants and tourists.
In the case of merchants, what they say is a lack of innovation and payment alternatives “obviously results in very high prices for the few existing options, for the weak innovation available and an important competition in their digitalization and internationalization process when compared to the its European and global competitors”.
With only one processing entity and without universal access to all payment schemes, “the digitization and internationalization process” of merchants turns out to be difficult.
In the case of emigrants, the authors of the letter point out that they are penalized when sending remittances, for using “the accounts and cards that exist in their country of residence, forcing them to assume costs with bank accounts and cards only for this purpose “.
Tourists and foreigners visiting Portugal “are prevented from paying in several places with their unrestricted Academic cards and purses, this is because a substantial part of the terminals do not allow the use of multiple attempts, they were linked only to a certain brand “.
The signatories detail four factors that, they say, are at the origin of the “lack of dynamics and economics of market competition”.
In addition to the “perpetuation of linking schemes to payment terminals” and the “lack of technological neutrality on the part of public entities when contracting payment services and providing payment channels”, they point out the “linking of the possibility of processing domestic scheme brand cards to the domestic scheme group of companies’ processing obligation for all other card brands”.
Finally, they also accuse services such as “service payments, fine payments, balance inquiries, tax payments and digital authentication being in fact associated with the ‘scheme’ and freely available under parity conditions to all IPME”.
The five associations and companies consider that there is “a viable alternative for improving the conditions of the payments market in Portugal” if three points are met, among others: “encourage, participate and work together with the Bank of Portugal in a more constructive approach, dynamic and really proportional for the payments sector”, “ensure compliance with the regulations and decrees in force, in particular, in view of the initiatives taken by the Competition Authority” and “call on all inspired parts of the market to, in an effective and continuously develop the payments sector in Portugal”.
The signatories to the letter underlined that they do not intend to question the existence or contribution of the existing IPMEs in the country and that they hope that these “continue their pace of growth and internationalization, guaranteeing, at the same time, the growth, diversification and dynamization of the market of national payments”.