From regulatory point of view, interest rate derivatives – both OTC and exchange traded – have been allowed and these provide the opportunity to hedge the interest rate risk. Liquidity requirements on a broad SLR basis as also on a more granular basis are in place and banks’ positions are constantly monitored to ensure that mismatches are controlled.
To bring SEPA for Cards to fruition, it is necessary to surmount these obstacles, as national card schemes are at risk of extinction, and competition might decrease to a duopoly of international schemes with similar business models. Again, discussion of these obstacles should not divert attention away from the great benefits that SEPA for Cards will bring to banks, merchants and cardholders.