Paying a Fair Price For Services Rendered
by Olivier Bornecque, Chairman, AFTE – The French Association of Corporate Treasurers
The AFTE is pleased that SEPA is focusing attention on interbank commissions. The AFTE has always objected to the principle of these commissions. While it is natural for companies to pay a fair price for the services offered by their banking partners, the interbank commission system results in an imposed mini-mum invoicing, which limits the possibilities for negotiation and consequently discourages competition among financial establishments. We believe, also, that the interbank commission system as it exists in France today leads to an imbalance that benefits the payer bank. Additionally, in the framework of SEPA Direct Debit, where mandate management is transferred to the creditor, the payer bank’s role is diminished considerably, whereas the creditor’s responsibilities and administrative costs are increased.
The AFTE wishes to emphasise its support of everything that promotes European integration, and especially the SEPA project.
We propose that the future structure be based on the following three criteria: the payer bank takes on risk that must be remunerated; the payment system that processes the transaction involves a cost that must be compensated; only an e-mandate can justify fair remuneration to the payer bank. It is the AFTE’s view that companies should pay a fair price for services received, which implies that invoi-cing must always be clear and correspond to a real cost. The implementation of SEPA provides an opportunity to review interbank commissions and to assure that each party’s costs correspond to processes carried out, risks taken, and services rendered. This reform, by improving transparency, rebalances fees to the advantage of the most recent products, and facilitates migration towards the new SEPA payment instruments. Let us not miss out on this unique opportunity.
The AFTE wishes to emphasise its support of everything that promotes European integration, and especially the SEPA project. Any delay in the technical developments of SDD in banks will have repercussions on the changeover to SEPA in companies, which could affect the implementation of SCT (SEPA Credit Transfer), two products whose launch will be simultaneous for many companies. This would significantly compromise the attainment of critical mass within the desired timeframe.
Companies themselves will assure the success of SDD through rapid adoption of the new standards, and they will be motivated if they can expect at least lower banking costs. The AFTE is fully opposed to all specific commissions that might be imposed, regardless of duration and amount, in order for banks to amortize their investments. While the AFTE recognizes that banks have significant investment needs, those of companies are also very great, in terms of both IT and organization. Should commissions of this kind ever come into use, companies would be forced to pass them on to their clients, and thus to the final consumer.