News and press overview

Financial-I December 2009 From Value Chains to Value Networks

SEPA is a major step towards an integrated payments market in Europe, which will bring substantial economic benefits based on economies of scale. But in parallel with SEPA, there is a shift of paradigm in terms of the way value is created in the payments industry. This shift goes from pure economies of scale to value generation by providing access to a network by means of its links and connections. From a value network perspective, the latter is a much more effective way of generating value than simply handling payment orders. An interesting example of this new shift is the recent development made by Equens, one of Europe’s leading processors of card and payment transactions. In connection with the implementation of SEPA and ongoing migration towards it, Equens established a three-stage ‘value network’ of SEPA clearing and settlement mechanisms (CSMs). This change of paradigm in the payments industry – from value chains to value networks –will help clients connected to those value networks to achieve considerable cost savings in their payment back offices and provide new payment channels to their customers.