New debit card on Maestro’s block
TEXT OF INTERVIEW
BOB MOON: Reuters is reporting today that Europe might be getting its own brand of debit card. It says a number of European banks are in secret talks with the goal of challenging the market-leading MasterCard and Visa debit cards. Which raises some questions that we put to Marketplace’s Stephen Beard in London: Why now? And is this just a business move, or will it be good for consumers?
BEARD: Yes consumers should benefit because there will be more choice. I mean, why is this happening now? Because the European Union’s just adopted new rules setting up a single Euro payments area so that consumers within the Euro zone can send euros across border into another Euro country without any charges. And there are moves afoot to set up a single E.U.-wide debit system. So with all these changes afoot, these European banks are concerned that because companies like MasterCard and Visa have the momentum, that they will dominate and monopolize this business.
MOON: And this isn’t just a European issue right? I mean I sense that this is the wave of the future here, that banks are trying to get in on all of the plastic that we’re using and these other alternative forms of payment.
BEARD: That’s exactly right and this really is opening up globally with the increasing use of cell phones for example. But the banks want to make sure that what profits are to be had from these transactions go to them rather than the middlemen like MasterCard and Visa.
MOON: Marketplace’s Stephen Beard in London, thank you.
BEARD: OK, Bob.
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