The Single Euro Payments Area (SEPA) Council has met for the first time. The body, brought about by the European Central Bank (ECB) and European Council (EC) and consisting of representatives from the demand and supply sides of the European payments market, is seeking to guide the future development of SEPA amidst criticism of the governance structure and a lack of consultation with end users. Its first meeting in early June (7/6) discussed the requirement and parameters of establishing migration end dates for SEPA and the future of a SEPA for cards.

The one-year delay to the introduction of the SEPA Direct Debit (SDD) payment instrument, put back until November of this year, and bank concerns about the expense of the project in these economically difficult times, allied to slow returns and uptake are some of the major reasons for the formation of the SEPA Council. In addition, the failure of national governments to fully support SEPA, likely to be exacerbated as Euroland governments now have much more pressing worries about the sovereign debt crisis to concern them, is also thought to be a motivating force to try and assist the EU payments convergence project.

Membership of the Council comprises of demand-side participants, such as corporations, retailers, consumers, SMEs and national public administrations, alongside supply-side participants, such as commercial and High Street banks, payment institutions, and the bank-backed European Payments Council (EPC), which designed the SEPA-compliant payment instruments like the already introduced SEPA Credit Transfer (SCT). The Eurosystem itself is represented by four national central bank board members from across the Euroland.

According to Michael Barnier, Internal Market Commissioner, the establishment of the SEPA Council is "a crucial step forward" in realising an integrated market for payments. "To achieve the full potential of SEPA, we clearly need to improve user involvement in this project, both from early design to final implementation," he added. "I am delighted by the high level of representatives and I very much hope that this new Council will act as a catalyst to create a retail payment framework fully meeting the expectations of all actors."

The Council will meet twice a year for an initial period of three years. Before the end of 2011, however, the EC and the ECB as co-chairs of the body, will evaluate its efficiency and functioning so far before agreeing to any extension.

In an attempt to talk up the struggling SEPA project, which has been accused of lacking focus, Gertrude Tumpel-Gugerell, an ECB executive board member, said: "We need to recognise the importance of user involvement for the success of SEPA. The SEPA Council aims at bringing together, at the highest level, the demand and supply sides of the European payments market, without, however, replacing any of the existing bodies, such as the European Payments Council (EPC). The establishment of the Council marks a unique milestone in the governance of the SEPA project. The Council will make sure all necessary steps are taken to guarantee the success of SEPA."

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