The European Payments Council (EPC) has recently released the default remuneration model for the Single Euro Payments Area (SEPA) Proxy-Addressed Authorization (SPAA) scheme. This highly anticipated move aims to establish transparency and standardization within the payments industry, providing insights into the remuneration structure for participants.

Understanding the SPAA Scheme

The SPAA scheme is designed to enable easy and secure pan-European payment initiation through the use of proxy addresses. By associating bank accounts with easy-to-remember identifiers such as mobile phone numbers or email addresses, the scheme aims to simplify transactions while maintaining robust security standards.

Ensuring Fair Remuneration

Given the growing popularity of the SPAA scheme, numerous banks and financial institutions have expressed interest in participating as proxy service providers. However, concerns regarding the remuneration structure have been raised due to potential discrepancies, leading to the necessity for a default remuneration model.

The newly published default remuneration model by the EPC offers a standardized framework that sets out clear guidelines for remuneration calculations. This ensures that all participants within the SPAA scheme receive fair compensation for their services, regardless of their size or market position.

Key Features of the Default Remuneration Model

The default remuneration model includes several key features that promote fairness and sustainability within the SPAA scheme:

• Transparency: The model provides a transparent breakdown of the remuneration components, allowing all participants to understand how their earnings are determined.
• Equitable distribution: The model ensures that remuneration is distributed fairly among participating banks and proxy service providers, considering factors such as transaction volumes and market share.
• Flexibility: The model offers flexibility to adapt the remuneration calculation based on specific circumstances or agreements between participants, empowering them to set mutually beneficial terms.
• Review process: The default remuneration model will undergo periodic review to ensure its effectiveness and adequacy in responding to evolving market dynamics and participants’ needs.

Promoting Harmonization and Trust

The publication of the default remuneration model by the EPC represents a significant step towards harmonizing practices across the SPAA scheme. By providing a clear and standardized framework, it fosters trust and confidence among participants, encouraging further adoption of the SPAA scheme.

Moreover, this release demonstrates the commitment of the European Payments Council to promote fairness, transparency, and competition within the European payments landscape. The EPC recognizes the importance of establishing a level playing field for all parties involved, ultimately benefitting businesses and individuals alike.

Conclusion

The availability of the default remuneration model for the SPAA scheme is undoubtedly a positive development within the payments industry. It not only ensures fairness and consistency for participants but also boosts the credibility and sustainability of the scheme as a whole. As the SPAA scheme continues to gain prominence in the European market, the default remuneration model will serve as a valuable reference point, facilitating successful participation and collaboration among banks and proxy service providers.