New payment systems for all – or only for some?


New payment services such as cards, internet and mobile payments may leave many people behind, while also making it more difficult for them to pay in traditional ways such as cash. This is the conclusion of a study on the Impact of New Payment Systems (NPS) on financial exclusion in the UK and four more countries (France, Italy, Poland, Sweden) commissioned by EUFFI, the European Foundation for Financial Inclusion.

The study was presented to Michel Barnier, Commissioner for the Internal Market and Services, at a meeting in the European Parliament hosted by German MEP Evelyne Gebhardt.

“It is no longer acceptable that millions of Europeans are restricted from having a bank account (and) it will not be acceptable that new payment technologies, of which it is also important that Europe maintains its technological command, have the effect of reinforcing the exclusion of some consumers… for these reasons, financial inclusion is high on our agenda.” Barnier said during the presentation.

MEP Gebhardt said at the launch “The access to basic banking services and traditional means of payment, such as cash payments or paper-based transactions must become a universal right. We need to pay special attention to vulnerable consumers.”

Cash is the most important and often the only means of payment for those at risk of exclusion but the study shows that it is becoming harder or more expensive to pay in cash. Several examples of financial exclusion have been documented in the study: unsuccessful asylum seekers in the UK cannot receive state financial support in the form of cash but only plastic payment cards (credited weekly) which stigmatises them and brings hostile behaviour in some shops and supermarkets.

The study notes individual cases throughout Europe, which are part of a wider trend, where cash is not accepted (e.g. public toilets in Sweden, school canteen fees in France) or is penalised (some banks are charging up to €9 to handle cash payment). The study underlines that vulnerable groups such as migrants, low-income, over-indebted, old and disabled people are reportedly experiencing difficulties in using NPS or cannot have access to them for different factors (lack of digital literacy, income, residential status, mobility and more).

Access to financial services is essential for full participation in modern society. For those at risk of exclusion, payment services must be cheap and transparent. For EUFFI, the challenge for payment system providers and policy makers is to preserve choice of payment methods and to ensure that new payment systems are adapted to the needs of those at risk.

Jim Murray, President of EUFFI, said “The factors that trigger exclusion include low income, uncertain income, changes in status, isolation, disability, and previous financial history, or lack of one.  For some, sadly, financial exclusion is life-long but many of us will experience it at some time in our lives. We all have an interest in affordable, accessible and transparent payment systems.”

The study is available to download from

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