Written answers

Tuesday, 24 May 2011

Department of Finance

Electronic Payments System

6:00 pm

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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Question 71: To ask the Minister for Finance his e-payments strategy; and if he will make a statement on the matter. [12408/11]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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Question 72: To ask the Minister for Finance the position regarding the national payments implementation programme; and if he will make a statement on the matter. [12409/11]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 71 and 72 together.

Government policy is to promote the increased use of electronic payments throughout the economy, with the longer-term objective of significant reductions, over a number of years, in the volume of paper-based payments in use throughout the economy. This policy is fully aligned with and is developing in tandem with market and regulatory developments at EU level, including the Single Euro Payments Area (SEPA), the implementation of the Payment Services Directive from November 2009 and the recent implementation of the revised Electronic Money Directive from 30 April 2011. The Government has also promoted this policy objective through fiscal measures, including a reduction in stamp duty on combined ATM cards from €10 to €5 in Budget 2009, and an increase in stamp duty on cheques from 30 cent to 50 cent per cheque to further disincentivise cheque usage.

In 2009, at the request of the then Minister for Finance, the National Payments Implementation Programme Advisory Group provided recommendations to the then Minister for Finance on possible mechanisms to further promote the development of electronic payments in the economy. The Advisory Group's report found that Ireland still lags behind other EU Member States in terms of use of electronic payment instruments, such as credit transfers, direct debits and card-based payments.

The report endorsed the Government's commitment to the development and implementation of a new national payments plan. It also recommended a strategy to deal with those who currently do not have any facility to make and receive electronic payments and recommended the establishment of a Task Force to prepare the plan.

My Department is in discussions with stakeholders including the Central Bank of Ireland and the Irish Payment Services Organisation on how the recommendations of the Advisory Group can best be implemented and I propose to publish the Advisory Group's report in tandem with any future announcement on the next steps to be taken in relation to the Group's recommendations.

Separately, as part of the approval by the European Commission in July 2010 of restructuring of the banking sector, the Irish authorities committed to a number of market opening measures in order to enhance competition in the Irish banking market. One of the measures agreed was to implement a SEPA migration plan for the public sector by the third quarter of 2011. This commitment will promote economy-wide migration to SEPA which will, in turn, promote further competition in and modernisation of payment systems, including migration away from paper-based and cash processes. Draft legislation to set binding end-dates for full migration to SEPA is currently under consideration at EU level.

A separate commitment agreed with the European Commission of relevance to Government policy on electronic payments relates to support for and promotion of the availability of basic bank account services. I refer the Deputy to Question Reference No. 12410 on today's Order Paper which sets out progress to date in relation to this commitment.

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