The recent report from Tower Group expressing deep concern about the impact of the Payments Services Directive (PSD) between banks and their corporate customer's, makes very interesting reading. It appears to substantiate the underlying messages found within
the white paper "SEPA moving against the tide". With both documents coming from different starting points but arriving at similar conclusions, does this indicate a fundamental problem at the moment between
banks offering their services and the corporates particular requirements?
The whitepaper details the corporates problems with SEPA and the banks focus on their own implementation and compliance without much consideration for the corporate needs. This same attitude by the banks can now be seen in the PSD, as reported by the Tower
Group, who comments that the banks energies have been on SEPA rather than the wider issues brought to the fore by the PSD. As mentioned on
Finextra, the Tower report highlights the issue of renegotiation of contracts between banks and corporates and this was equally missing according to the corporates surveyed during the research for
the SEPA white paper. What's going on? Are the banks missing a trick or are the corporates slow to realise the benefits to them of the new European payments landscape being created? Or is it all of this and more?
It's hard to believe that banks would be unaware of the impacts of the PSD on their business and the need to protect the commercial relationships with their corporate customers. It's also unlikely that corporates would be unaware of the potential benefits
of contract renegotiation. So why does there appear to be a gap between banks and corporates?
Of course this might just be a timing issue with a host of new services and prices sitting in the out tray of the banks, just waiting to be released to the already expectant corporates. However, if it is that the corporates are waiting to snare the banks
with their particular demands, creating a new market free for all, pitching for the best economic price with the most efficient services, we may be on the verge of a major shift within the banking industry.
As the credit crunch impact is still reverberating around banking profits and forecasts, and given, that we are still some way from understanding the true depth and breadth of this crisis, any detrimental effect on the banks pricing, will be extremely unwelcome
by the boards of all banks.
When banks are in crises they tend to retrench and wait until the storm passes over. The PSD and SEPA appear to be very unwelcome additions that might make the current storm into a hurricane. Will the corporate be patient with their banks or will they become
more aggressive looking for the service and prices now owed to them by political directives? It might not be too long before we know!