Payments Market

The Payments Market as we know it is changing. In Europe, a number of initiatives brought about by the European Commission, will inevitably increase the competition amongst the service providers.

For example, the instigation of the Single Euro Payments Area (SEPA) will lead to the possibility of being able to conduct (trans-)national payments in Euros throughout Europe, with the same conditions, rights and obligations, regardless of where the payment was made.

As more and more card issuers take their card business cross-border, an increasing internationalisation of the card industry will start to emerge. SEPA is just one initiative that will provide an excellent growth opportunity for all card payment companies that are able to provide flexible platforms, E-Commerce and Point of Sale facilities.

As E-Commerce continues to grow at a rapid rate around the world, E-Clear, already a well established company within the international payments arena, is strongly positioned to meet and serve the growing needs of the industry, as well as to grow and develop its own particular business operations.

Over the five years from 2000-2005, debit card transactions increased by 18% in the Point of Sale environment and, although perhaps not quite so dramatically, transactions worldwide are predicted to continue to increase (see Graphic 1). The overall worldwide purchase volume of debit and credit cards reached 2,257 billion Euros in 2006, an increase of 15% compared to 2005.

The growth rate in E-Commerce has been very impressive around the world over the last few years, with no apparent end in sight. The B2C sales in Western Europe reached 125 billion Euros in 2005, while in the US, goods amounting to 115 billion Euros were sold over the internet (Forrester Research). It is estimated that in Western Europe, total sales using E-Commerce will increase to 2,217 billion Euros in 2008, an increase of 326% since 2004 (see Graphic 2).

If this trend continues the growth in electronic payments will outpace that of GDP for the foreseeable future, and pressure will therefore increase on legacy payment systems to cope with increasing card volumes. The main business drivers in the current payment industry are: