Clarifying to whom, where, and when payments are made : Recommendations from the ERPB Working Group on Transparency for Retail Payment End Users

Abstract

It has become increasingly difficult for consumers to identify to whom, where, and when they have made payment transactions, as the descriptions provided on account statements do not always match the expectations of the consumer. Given that multiple actors in the payment chain can influence the information provided to the consumer, this problem can only be addressed with the involvement of multiple stakeholders. This paper discusses the recommendations made by the working group established by the Euro Retail Payments Board (ERPB) to address this issue. As regards the name of the party to whom payment has been made, the working group recommended that the commercial trade name of the payee (defined as the name used by the merchant to identify itself to the consumer) should be used along the entire payments chain. Regarding the where element, the working group recommended that the account statement should indicate the precise geographical location of the transaction. In the case of online commerce, the commercial trade name displayed on the website, or the commercial trade name of the payee’s online platform should be mentioned. Related to the when element, the working group recommended that the account statement should indicate clearly the date and time of the transaction as it would be known by the consumer. The working group called upon all actors involved to create and maintain quality transaction data and to ensure that the underlying technical standards being used are capable of supporting the collection, preservation and safe transmission of the data required by the consumer. The industry was expected to implement these voluntary recommendations by June 2024, but although progress has been made, the overall progress seems to be lagging slightly as the various stakeholders are addressing the issue in isolation. In the meantime, the European Commission has adopted some of the working group’s recommendations into proposed new payments legislation.