Saturday, March 04, 2006

'Cheerful message': Commission will intervene in EU-Cards market

The Financieele Dagblad reported yesterday that Commissioner Kroes left a prepared speech aside during the Hofstad Lecture in the Netherlands. Just to inform the banks around Europe that price differences between bank-cards in Europe varied more than 400 % in the EU-market. Which will result in further measures by the Commission. In the speech, she called this the 'cheerful mesage'.

The basis for the intervention would be that it is 'incomprehensible' why prices would vary so much in Europe. As Mrs Kroes stated.

Well, perhaps a bit of evolution theory might do good here. What if the Commissioner would just imagine that commercial behaviour, law and history between the EU-countries varies in such a respect that each national retail payment domain is a perfect equilibrium, resulting in the most efficient payment solutions for that specific environment.

Now let's try the comparison with nature. Imagine we take one single rabbit, plant it in 25 EU member states, and wait a couple of hundred years. It would disappear from some EU-states while breeding happily in others. Meanwhile nature would evolve and the rabbit would be distinct in each natural habitat.

Let's go on to imagine that the Commission would decide that this variety of rabbits (some varying even more than 400 % on distinct features) would be no good for the European Integration and market. So the Finnish rabbit, with too much fur compared to the EU-average, needs to be stripped. And the Spanish rabbit, with little fur, needs to grow hair. And so on for all the other countries.

My guess is that, unless you complete egalize the natural habitat in all EU-countries, there's not much use in killing the country-specific variations of rabbits and replacing them with an average rabbit. That average rabbit will freeze in Finland and overheat in Spain.

Let's hope the Commission has the wisdom to intervene in such a manner that a 'guided evolution' of the EU-cards-market may occur, rather than a quantum leap into an ice-age where cards business will not be as interesting any more. Because that ice-age would result in prolonged use of good old costly cash rather than the more efficient cards.