The Commission is proposing to introduce minimum charges for retail cross-border payment transfers before the arrival of the single currency in January 2002. The EU is keen to expedite the process amid accusations that banks have failed to respond to repeated requests to improve consumer payments networks in advance of the change-over. The EU bases its claims on research studies conducted over an eight-year period into cross-border credit transfers which indicated that banks had failed to reduce costs.

In a written response to the Commission, the EBF claims that the research and the EC's interpretation of it is badly flawed. The industry lobby group argues that many pinpointed results are not representative, as transfers from fewer than three banks per country (average: 2.67 banks) are considered. The EBF also notes that the results of previous studies dated 1993 and 1994 are compared with the results of the most recent research conducted in May 2001, without taking adjustments for inflation or comparing charges with the general rate of increase in the financial services industry for the same period.

"Given the numerous on-going industry efforts in the field of cross-border payments (i.e. MIF, IBAN, BIC), a fair examination can only be made after the introduction of the euro as fiduciary money," states the EBF.

In comparison with the study of 1994, the EBF claims that charges have actually decreased by more than five per cent when viewed in isolation. "The decrease would be substantially larger when taking account of inflation since 1994 and comparing the level of charges with the general rate of price increase in the financial service sector for the same period," states the Federation.