By Caroline Hometh
Payvision
For many ISOs and acquirers across the country, one of the most attractive areas for international sales expansion is Europe. Now is the time to tap into this lucrative space, using the most effective sales tools of knowledge, education and due diligence.
Europe has undergone remarkable changes in the past few years. According to industry statistics, this particular market has experienced double-digit growth in e-commerce since 2008, with extraordinary increases in eastern and southern European countries.
The most notable changes in the European card-not-present arena are recent regulatory mandates that have materially changed the European e-commerce landscape. They include the Single Euro Payments Area (SEPA) and Payment Service Directive (PSD).
SEPA is defined by the European Payments Council as "the area where citizens, companies and other economic actors can make and receive payments in euro, within Europe, whether within or across national boundaries under the same basic conditions, rights, and obligations, regardless of their location."
SEPA applies to the 27 European Union member states, as well as Iceland, Liechtenstein, Norway, Switzerland and Monaco. SEPA was set up by the European banking sector and is regulated by the EPC.
SEPA provides a new basis for harmonized financial services, Internet payments and e-invoicing throughout Europe. Its objective is to ensure consistency between cross-border and national payment transactions.
The tools to accomplish these goals include harmonized bank account numbers, a pan-European debit card network, European direct debit network and the SEPA credit transfer (SCT) service.
In January 2008, more than 4,300 banks in 32 countries representing roughly 95 percent of payment volumes in Europe took a historic first step in starting SEPA by launching the SCT for euro payments. The SCT enables payment service providers to offer a core credit transfer service throughout SEPA, whether for single or bulk payments.
With the SEPA migration set for Dec. 31, 2012, the EPC put a stake in the ground, and all financial institutions are moving toward it, but it is not sure that all aspects of SEPA will be implemented by 2012. Nevertheless, the opportunities with SEPA for e-commerce abound.
Authored by the European Parliament in 2007 and translated into national law within the member states, the PSD seeks to prevent money laundering and provide consumer protection for payment transactions.
The PSD ensures that rules on electronic payments are the same throughout Europe. It details information a consumer should receive and makes payments safer.
The PSD will also provide the legal foundation for creating an EU-wide single market for payments. It hopes to establish a modern and comprehensive set of rules applicable to all payment services in the EU. Like SEPA, the PSD target is to make cross-border payments as easy, efficient and secure as a domestic payment within a member state.
It also seeks to improve competition by opening up payment markets to new entrants, fostering greater efficiency and cost-reduction. The PSD provides the necessary legal platform for SEPA.
All payment institutions have to be PSD-certified before April 1, 2011. The impact of the PSD on European e-commerce can be seen in various areas. In addition to all payment institutions needing to be certified, they will be monitored by national authorities.
This provides a more transparent European market with barriers to criminal activities. It also provides better consumer protection and a more efficient money-laundering monitoring system.
No matter where card-not-present merchants are located, they should consider selling globally in international currencies. They should also recognize the complexity of globalization and look to knowledgeable sales professionals aware of all the country-specific rules and regulations
Any merchant level salesperson interested in developing expertise in global sales should research this ever-changing marketplace and take advantage of every educational opportunity.
Carrie Hometh is a respected industry professional in the international marketplace with more than two decades of global experience and expertise. She currently serves as Senior Vice President of Sales and Marketing for Payvision, a leading international payment solutions provider that offers a comprehensive suite of products and services that include global acquiring, multicurrency processing and alternative payment solutions. She can be contacted at c.hometh@payvision.com.
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