The decision to appoint SIA as the partner for the STEP2 project was confirmed by the EBA at its general meeting in Verona. The system has been commissioned in response to European regulatory pressures for banks to cut the costs of transmitting cross-border euro payments to the levels of domestic money transfer charges.

Under STEP2, cross-border and domestic retail payments will be sent as files to the EBA/SIA operation center and will be then processed, cleared and sent for settlement. Settlement Services will be provided either directly by banks, through settlement agent banks or through central banks.

Olivier Mas, EBA chairman, says the new system will be available to European banks via SwiftNet and other secure communication networks by mid-2003. "The EBA’s pan-European ACH will be available to process cross-border and domestic bulk payments at cost levels which will be comparable to those of existing domestic ACHs," he confirms.

Renzo Vanetti, SIA CEO, adds: "The additional value in concentrating all inter-bank operations in a unique clearing house system, is that participants to the system will be able to benefit from economies of scale generated by large volumes. As a result, price for banks will be highly competitive."

Maurizio Sella, chairman of both the European Banking Federation and association of Italian banks, says that the Italian banking community will support this project by gradually moving their domestic and European payments into STEP2.

The decision to go with SIA - architect of the successful MTS bond trading platform - is a major blow to interbank payments network Swift, which currently provides the messaging infrastructure and computing facilities for EBA's EURO1 large value payment system and the STEP1 low-value payment system.