Standardisation in payments for digital commerce: Where are we, and where are we going?

Abstract

In the field of payments, standardisation is indispensable to establish successful products and services. There are good reasons to have the actual standards set by market players, driven by their business needs and foreseen opportunities. The current author believes this is to be preferred above setting a standard through the intervention of a governmental body. The latter would contain the risk of hampering future technological innovation. Nevertheless, there is an obvious push from regulatory and supervisory bodies to further harmonise standards and business rules for payment methods and processes in the European Union as part of a policy to reinforce the (digital) single market. This very policy comprises activities in the area of digital commerce on improving parcel delivery, simplifying value added tax (VAT) rules and strengthening the trust in online services—all in a cross-border context. This paper comments on the current market and regulatory forces that drive harmonisation in payments for digital commerce.