The European Commission is looking at ways to get banks to use its TARGET Instant Payment Settlement (TIPS) system, which is designed to enable people and companies transfer euros to each other in seconds.
According to a report in Reuters, with slow adoption among banks to the TIPS system which was launched in 2018 and is a challenge to payment companies and technology players such as PayPal, the European Commission is looking at ways to speed up adoption. The system lets people in Europe transfer euros between each other even if the local bank is closed. In Europe payment services offered by PayPal, Google, Facebook, Amazon, Alibaba, and Tencent dominate the market.
“We are reflecting on whether a stronger regulatory push would be needed to speed up this process,” the EU Commission’s vice president in charge of financial services Valdis Dombrovskis told a FinTech conference in Brussels, according to Reuters. He said the system has the potential to disrupt the existing payment services. “In a few years, we want Europe to set new global standards for instant payments technology,” Dombrovskis said.
In November, SWIFT, the payment messaging firm based in Belgium, started implementing its SWIFTNet Instant service for the TARGET Instant Payment Settlement (TIPS). The service enables customers to make instant payments from anywhere inside the Single Euro Payments Area. When announcing its integration with TIPS, SWIFT said it’s a step into the future, providing a pivotal building block for access to the future Eurosystem Single Market Infrastructure Gateway. At the time Marc Boyle, a director at the European Central Bank, welcomed the development, saying the live launch is an important moment for the financial future of Europe. “The go-live of TIPS today is a further landmark in the Eurosystem’s creation of a truly domestic market for payments and securities settlement in Europe,” he said. “We are pleased that SWIFT supports the integration of the European payments market as one of the network service providers of TIPS.”