Electronic Payment Service Providers Association

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Ashlynn Hall
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1 Electronic Payment Service Providers Association

2 Definition of EFISZ The Electronic Payment Service Providers Association, a socio-professional organisation of companies operating in Hungary that provide non-cash, electronic payment (ubiquitous mobile payment) services, is a non-governmental, autonomous organisation for communicating and representing interests and promoting consultation, established by the founding members in accordance with the provisions of section 3:63 of Act V of 2013 on the Civil Code and of section 4 of Act CLXXV of 2011 on the Operation and Support of Civil Organizations (Civil Act). The Electronic Payment Service Providers Association was established in 18 April 2017, according to the information in the order for reference 11.Pk /2016/4, the Budapest- Capital Regional Court registered under number Any organisation registered in Hungary that provides non-cash, electronic payment service developed and/or operated in Hungary, or has participated in the development and in the delivery of such solutions, or provides or implements non-cash, electronic payment systems and otherwise meets the conditions set out in the articles of association, may become a member of the Electronic Payment Service Providers Association. Summary of the background Mobile commerce sales are expected to grow by 42% annually in 1 the coming years. New technologies will lead to significant changes in the consumers purchasing habits, and the number of non-cash payment channels will increase. Mobile payment currently refers to the following options 2 : SMS payment, direct billing (through the monthly bills issued by mobile operators), ubiquitous mobile payment (using a debit/credit card, against the balance with an online payment provider), contactless payment with NFC technology. The advantage of mobile payment for users is that it is more convenient and quicker than traditional payment solutions, and in the long term (also considering investment costs) it results in lower transaction fees (the consumer side of the digital overhead reduction ). From the government s point of view, mobile payment means decreasing costs (the provider side of the digital overhead reduction ) and supports the continuous improvement - in such a way that is visible for the public - of the quality and accessibility of public services. As mobile payment is becoming more widespread gradually, the interoperability of payment channels is becoming more and more important. On the consumers side, interoperability allows for more flexibility and thus increases the public acceptance and the spread of mobile payment, while on the policy side, it supports the healthy development of the market. 1 2 Consumer protection aspects of mobile payments, European Parliamentary Research Service, June 2015 European Commission - Green Paper 2012

3 The objectives of establishing EFISZ To support the improvement of the Hungarian non-cash, electronic payment ecosystem and the development of new service and business models. To represent, both in Hungary and internationally, the interests of Hungarian noncash, electronic payment service providers. To jointly represent Hungarian non-cash, electronic payment service providers and their interests before decision makers. To provide and coordinate education to the public about the use of non-cash, electronic payment services, and to establish cooperation regarding this task with governmental actors and financial stakeholders. To support the marketing and communication of Hungarian non-cash, electronic payment services. To develop a role of continuous coordination in relation to the introduction of noncash, electronic payment services in public administration and services. To create the Code of Conduct of Electronic Payment Services, which is of great significance from a consumer protection aspect as well, and to monitor the implementation of the principles set out therein. To develop the Mobile Payment Consumer Protection System of Electronic Payment Services, and, related to that, to establish the Ethics Committee of the Association of Electronic Payment Providers. To develop the Electronic Payment Strategy with the involvement of industry operators (government and financial stakeholders). To support non-cash payment. Communicating and representing interests and promoting consultation In its activities of communicating and representing interests and promoting consultation, the Association, in cooperation with the organisations performing preparatory legislative work, provides opinions on regulatory concepts and the drafts of relevant regulations regarding mobile payment and non-cash payment solutions in order to represent the interests of consumers and providers of mobile payment services. Representing interests also involves maintaining continuous contact with governmental and national bodies, with the aim to modernise legislation, to maintain interoperability and to transform the legislative or organisational environment that prevents the completion of mobile payment and related services.

4 Priority consumer protection areas in mobile payment A. Providing information to consumers The contractual and operational connections of mobile payment actors (e.g. service provider, mobile operator, bank card issuer, other payment provider), which may be different in different channels, form a system that consumers often find obscure, so they experience much more insecurity regarding their rights and obligations as compared to traditional purchase processes. In addition, the conditions and costs of transactions are often difficult to understand to large groups of users, and the loss of transactions is more difficult to prove without tangible evidence. B. Protection of personal data, data security During mobile payment transactions, new types of personal information (e.g. geolocation, passwords, payment information) are processed by various actors of mobile payment systems (e.g. mobile operators, developers, payment service providers, merchants). Consumers are not necessarily aware of what kind of data is processed about them and where, so their ability to make decisions regarding these are rather limited. Thus, the general prohibition of consumer profiling must be a priority (e.g. this is the practice with the services of Facebook, Google and Apple). In addition, with the development of technology, the protection of these data and the prevention of unauthorised access by third parties (e.g. viruses, malware) pose an increasing challenge to developers and users of services. C. Unfair commercial practices Hidden costs in mobile payment that are not clearly defined for users (e.g. transaction fees, communication fees, etc.) pose an actual risk to customers using mobile payment. D. Specially protected group of consumers Certain groups of consumers are at increased risk because of their health or social background and/or limited financial/technological knowledge (e.g. the complexity and insufficient comprehensibility of the service providers invoices and information material), which will pose an increasing obstacle to the future spread of mobile payment. For regulations supporting the spread of non-cash payment solutions, the education of these users shall be a priority, as well as providing them with information and special protection (supported by sanctions when necessary), and providing appropriate technological solutions (e.g. for the visually impaired). E. Handling balances forgotten by customers How service providers handle balances left behind by consumers for any reason shall also be regulated uniformly.

5 Code of Conduct Considering that practically there is minimal legislation providing for mobile payment services in Hungary, the Code of Conduct of Electronic Payment Services is to be created to prevent possible unethical conduct. An Ethics Committee is to be established to hear cases when the principles set out in the Code are infringed. Member organisations of the EFISZ need to agree to conduct their business in full compliance with Hungarian competition rules and the norms laid down in the Code of Conduct of Electronic Payment Services they have created. Accordingly, the Code of Conduct of Electronic Payment Services provides that: ü Member organisations shall conduct their business in mutual cooperation, and in such a way that it does not breach the requirements of business ethics, honest practices and business norms. ü In the course of their operation, member organisations shall strive to make a fair profit while acting in good faith and with great care. ü Conduct that infringes business ethics and honest practices is ethically condemnable even if it is not explicitly forbidden by regulations. To facilitate the resolution of ethical disputes resulting from the activities of member organisations, the Ethics Committee of the Electronic Payment Service Providers Association applies the provisions of the Code of Conduct of Electronic Payment Services. Founding members 1. Budapest Bank Zrt. 2. GIRO Zrt. 3. Magyar Posta Zrt. 4. Magyar Telekom Nyrt. 5. MKB Bank Zrt. 6. Nemzeti Mobilfizetési Zrt. 7. OTP Bank Nyrt. 8. Pénzjegynyomda Zrt. 9. Szövetkezeti Hitelintézetek Integrációs Szervezete

6 Board members Gyula Fatér, Director, Budapest Bank Zrt. Péter Forrai, Deputy Director, Magyar Posta Zrt. Márk Hetényi, Deputy Director, MKB Bank Zrt. Antal Kovács, Deputy Director, OTP Bank Nyrt. Dr.Zsolt Semeczi-Kovács, GIRO Zrt. Mihály Veres, General Manager, Nemzeti Mobilfizetési Zrt. József Vida, President, Szövetkezeti Hitelintézetek Integrációs Szervezete Direction of Association Mihály Veres, President Gábor Dávidházy, Secretary-General

ELECTRONIC COMMERCE SERVICE GENERAL TERMS AND CONDITIONS

ELECTRONIC COMMERCE SERVICE GENERAL TERMS AND CONDITIONS 1. Company data: Name: Magyar Posta Zártkörűen Működő Részvénytársaság Registered office: 1138 Budapest, Dunavirág u. 2-6. Trade register no.: Cg.