Bank of France governor Christian Noyer has criticized a European Union initiative aimed at increasing competition in the credit card payment market for not putting security at the top of the agenda.
Mr Noyer warned that the EU Competition Commission is playing a dangerous game with its draft law on card payments. Mr Noyer said that the law would allow a new category of groups such as telecommunications operators, retailers or specialist credit providers to be card issuers without meeting the same regulatory standards as the banks that currently run the system.
Mr Noyer’s comments are in response to competition commissioner Neelie Kroes, who warned that credit card companies will face antitrust action unless they end anticompetitive behavior in the payment card services they provide to consumers. I understand her concerns but it’s essential not to sacrifice security to other objectives, said Mr Noyer.
In France, and most other European countries, companies must obtain a banking license to operate credit card and other payment systems. However, Ms Kroes recently issued a fresh warning to credit and debit card companies that they faced legal action and fines unless they cut charges and opened up networks to non-bank competitors.