Background on Asamep and its Relevance
The Association of Payment Instrument Aggregators (Asamep) is a prominent organization in Mexico, representing companies that aggregate various payment instruments. Asamep plays a crucial role in shaping the Mexican payments landscape by advocating for policies that foster a competitive, efficient, and inclusive financial ecosystem.
Public Consultation by CNBV and Banxico
The National Banking and Values Commission (CNBV) and the Bank of Mexico (Banxico) have launched a public consultation on general provisions applicable to payment instrument networks. This initiative aims to modernize Mexico’s payment system by balancing the market, reducing costs, and creating a more competitive payments ecosystem.
Asamep’s Recognition of the Consultation
Asamep acknowledged the significant efforts made by regulators to reach this stage, stating that the public consultation is a crucial step in developing and modernizing Mexico’s payment network.
Objectives of the Proposed Measures
The proposed measures aim to strengthen the competitiveness and efficiency of the card payment ecosystem by reducing operational costs and establishing rules that promote interoperability between different networks.
- Enhanced user experience: Users can make and receive payments regardless of the institution or network used, facilitating transactions and increasing trust in electronic payment methods.
- Regulatory alignment: The consultation aligns with the objectives of competition, financial inclusion, and digitalization promoted by regulatory authorities, as reflected in the National Policy for Financial Inclusion and the digitalization and innovation axes of Mexico’s Plan.
Key Proposals in the Project
The state will define operational standards between different payment networks, adhering to international ISO standards. This approach aims to prevent unilateral market condition-setting by private entities and ensure transparency, neutrality, and fair competition.
- Cost reduction: Measures to decrease card payment acceptance costs, particularly benefiting small businesses by lowering transaction fees.
- Incentivizing digital payments: Lower costs encourage the adoption of digital payments and reduce cash dependency.
- Sustainable growth: Conditions to promote sustained growth in card usage, expand access to formal financial services, and strengthen the payment system’s infrastructure under international security, interoperability, and efficiency standards.
Specific Proposals
The project proposes maximum limits on interchange rates, the commission card-issuing institutions charge acquiring entities for each transaction. These caps aim to regulate a critical cost component for merchants accepting cards.
The document suggests maximum rates of 0.3% for debit card transactions and 0.6% for credit card operations.
Previously, an Asamep study indicated that interchange rates are often predetermined between competitors rather than determined through market processes. Therefore, setting appropriate rates is crucial; high rates decrease merchant acceptance of cards, while low rates reduce emitters’ incentives to assume operational risks.
Asamep’s Internal Review Process
Asamep is currently conducting an internal review process with its affiliated companies to submit formal observations during the public consultation.
Key Questions and Answers
- What is Asamep? Asamep is the Association of Payment Instrument Aggregators, representing companies that aggregate various payment instruments in Mexico.
- What is the public consultation about? The consultation focuses on general provisions applicable to payment instrument networks, aiming to modernize Mexico’s payment system.
- What are the objectives of the proposed measures? The measures aim to strengthen competition and efficiency in the card payment ecosystem, reduce operational costs, and promote interoperability between networks.
- What specific proposals are included in the project? The project proposes maximum limits on interchange rates, cost reduction measures for card payments, and conditions to promote sustainable growth in card usage.
