Madam, - Fintan O'Toole claims that the recent Budget initiative halving stamp duty on payments cards represents "financial coercion" (Opinion, December 11th).
However, his perspective that the Government is frustrating consumer choice does not square with the very significant growth in electronic payments over recent years and the corresponding reduction in share of cheque payments. Indeed, it is not even consistent with his own conclusion that the move to electronic payments is not necessarily a bad thing.
Perhaps Mr O'Toole may wish to consider the evidence. As far as cheque usage are concerned, Irish people are demonstrating a strong appetite for modern payment methods. For example:
1. Despite overall growth in cheque payments of about 6.5 per cent a year, cheque usage per head in Ireland has stabilised at 130 million.
2. The Department of Social and Family Affairs has increased EFT payments to 56 per cent, up from 34 per cent in 2004.
3. Payments to 135,000 farmers take place by EFT.
The reason for the Budget initiative is that the pace at which change is happening is slow. As highlighted by the National Competitiveness Council in its recent report, Ireland is falling behind other European countries in the adoption of electronic payment methods.
And this does matter: independent international research evidence is that an electronic payment costs between one-third and one-half of a paper-based payment. The total cost of a country's payment system may account for about 3 per cent of the value of its national output.
The action taken is, therefore, a sensible and prudent measure, which ensures the price of payment products reflects broader costs on society, while retaining the principle of consumer choice.
The Single Euro Payments Area (SEPA) is a very simple concept. SEPA will enable an individual to make a payment from one's own bank account anywhere in Europe making cross-border payments as easy as a domestic payment. It is a practical measure clearly aimed at reducing costs for businesses in particular, increasing competition and the convenience of payments for consumers.
The Government's approach to payments strategy is based on the needs of society as a whole and the common good and not that of any one sector of the economy. This was stated publicly by the Tánaiste last month in speaking to the banking industry when he said that a pre-requisite for the design of a successful payment strategy is one that meets the financial needs of all in society and in particular that the principle of financial inclusion must be the lynchpin of future payments strategy.
It is regrettable that a measure that clearly supports the realisation of real benefits for consumers and for the economy overall, and which helps our international competitiveness, is interpreted and represented in negative terms in Mr O'Toole's column. - Yours, etc,
JOHN CONLON, Press Officer, Department of Finance, Dublin 2.
Madam, - Is Fintan O'Toole serious in his defence of cheques and his castigation of Brian Cowen for introducing measures to speed up the adoption of electronic banking?
As a small business owner, perhaps I can point out some of the advantages of electronic payments.
They don't bounce. They can't be forged. They don't get "lost" in the post. They don't take a 10-mile drive and a hunt for a parking space to lodge them in the bank.
The only people who prefer cheques to electronic payments are "bad payers" seeking to extend their credit. - Yours, etc,
GAVIN TOBIN, Greenogue Business Park, Rathcoole, Co Dublin.