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Beyond the Transaction: Every Transaction Has a Story

EU Interchange Legislation Sets Course for New Beginnings

European Parliament, Brussels, BelgiumEuropean Parliament, Brussels, BelgiumA long and interesting legislative process comes closer to an end this week with the European Parliament formally adopting a new EU RegulatEuropean Parliament, Brussels, Belgiumion on interchange fees. At MasterCard we believe that, just as in life, from every end comes a new beginning. This case is no different.

The lengthy legislative process that began several years ago is finally over. I would not be credible if I said the new legislation is perfect. As we truly believe in market-based solutions, we remain concerned about the negative impact this regulation might have on cardholders.

We are also somewhat disturbed by the potential exclusion of some card schemes for another three years; but count on Member States to respect the principle of a level playing field at national level.

At the same time, we believe that the simple fact we now have an agreement will bring some necessary legal certainty for the fast changing payments market, which will help us all build a world beyond cash.

This is a fascinating journey, and don’t be misled by those who doubt it. I sometimes hear that abandoning cash, despite the undeniable advantages it brings to governments, businesses and consumers alike, is a utopic dream. Well, I do not agree.

It is true that cash still accounts for about 85% of global consumer transactions. Yet, it is also true that the way we pay for things has been changing more in the past 15 years than in the previous 150. Within this incredibly short time some European countries have already proved that the end goal of an (almost) cashless society can be reached. The most striking example is 97% cashless Sweden, with others following.

As people continue to seek simple, more secure and smarter methods of payments, we, at MasterCard, live and breathe innovation to make this possible. Just 10 years ago contactless and mobile payments belonged to a very distant, and some would have said “equally” utopic future. Both are now at the heart of our business. Just have a quick look at our latest announcements at the Mobile World Congress.

And Europeans are eagerly embracing these methods – just in the last quarter of 2014 tap transactions in Europe grew 174% year on year.

This is why, further encouraged by this new beginning, we really look forward to working in partnership with the European institutions, national governments as well as our customers and consumers around Europe to further build a world beyond cash.