- Banks in the eurozone are looking to implement instant payments by 2020
- This is believed to be in response to the Libra token
When Facebook released their Libra whitepaper in this month, there was great discussion both within the finance and crypto sector about what widespread use of the token could mean as it was apparent that the token will have a ripple effect on the global financial system. Since the release of the token, Facebook has been summoned by world leaders and is holding meetings around the globe to pave way for the Libra.
Now it seems that the effects of the token are being felt within the European Union as a June 29, 2019, report states that European Union Banks are looking to have a payment system in place by 2020 that will enable instant payments partially in response to the Libra token being launched around the same time.
Banks afraid of Libra
The concept of real-time payments is not necessarily new as they have been possible within the eurozone since 2017, but only half of the banks from the bloc have taken to this initiative. Now, with the Libra token due to launch in a few months the banks could be seeing competition as users would rather make use of an instant payment token such as Libra than deal with the traditionally slow and tedious nature of bank transactions.
The good news is that the banks are being kept on their toes as according to the Director General of the European Payments Council (EPC) Etienne Goosse, regardless of whether the Facebook token succeeds or not, competition from technology firms has always been a factor and banks are being forced to evolve faster in order to keep up with the times. He said:
“They come with a global solution, under a global brand offering many things that the consumers seem to find wonderful. […] So we have no time.”
Will instant transfers be enough?
He also stated that while EPC instant payment standards have seen adoption from about 60 percent of payment services providers in the eurozone, all banks in the Bloc could adopt the system by the end of 2020 and according to the report, other banking officials have confirmed that the 2020 date is possible and within reach but the eurozone will need to be covered for this system to go across all borders.
At the same time, there is a debate about whether or not this effort will be enough as the use of easy mobile applications and tokens will be more attractive to the average user than traditional banking systems which are often seen as obsolete in the 21st century
