German co-op banks to ditch domestic debit scheme

German co-op banks to ditch domestic debit scheme

In an effort to comply with new regulations governing the creation of a Single Euro Payments Area (Sepa), the Sparda banking group in Germany is to ditch the domestic debit ec (electronic cash) scheme in favour of using MasterCard's Maestro marque for both national and international debit card payments.

The co-operative banking movement - comprising 12 national banks and 2.65 million members - will make the switch to Maestro in early 2007. By issuing Maestro-only branded debit cards, the Sparda-Banks will become one of the first institutions in Germany to meet the new Sepa requirements.

Similar Sepa migration plans have been announced elsewhere in Europe. In Belgium, for example, banks have announced their intention to replace the well-known Bancontact/MisterCash local debit card scheme with Maestro.

MasterCard says other German banks have also signalled interest in the programme.

MasterCard says the switch will ease the transition for merchants, who will be able to accept debit cards which employ the same process and technical standards for both national and foreign debit transactions. In addition, it will be possible to group all debit payment transactions with one merchant card acquiring service provider, significantly cutting processing costs.

MasterCard says banks and their customers also stand to benefit from new features such as secure Internet payments and emerging contactless card capabilities.

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