More cross border financial services under consideration

Europe’s large banking and insurance industry is largely a national one. Despite advances in communications most of us still get financial services in the country we live in

A Green paper by the European Commission last year looked at promoting the integration of the retail market in financial services. MEPs on the Economic and Monetary Affairs Committee looked at the issues raised in early April whilst the full plenary will debate it in June.
There is no doubt that this is a growing market. Retail business by banks is responsible for 2 % of the European Union’s GDP. An ageing population is increasing the need for private and industrial provision for pension, health and sickness insurance.

Among the proposals contained in the Green paper and with which MEPs will have to wrestle are;

- ways to promote the purchase of financial services through telecommunications.
- progress in removing tax differences between EU members (main obstacle)
- broader access to credit history data registers

At present only 1% of people get financial services from across borders through telecommunications according to the Commission.

The present situation is that single market for retail services has been created and a legal framework that guarantees financial soundness is in place. The great challenge the Green paper points out is that there is still a long way to go toward harmonisation of payments and banking across the European Union. MEPs on the Economics Committee have appointed Austrian MEP Mr Othmar Karas (EPP-ED) rapporteur for the issue.

European Parliament

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