European cross-border retail payments could almost be said to be still in the “Middle Ages”: they are characterised by high fees, long execution times and very little transparency. This situation led to the EU Directive on cross-border credit transfers (Transparency Directive) coming into force early 1997, the outcome of which has, up to now, regrettably been mediocre.
As an example, if we compare the cost and time taken for a credit transfer of FRF 5.000 from Frankfurt to Paris, the fee charged by the different German banks varies - according to a German newspaper from DEM 20.00 to DEM 60.00 and the processing time takes between two and 14 days.