16 July 2013
Risk-averse countries can still embrace SEPA
Without doubt, the integration of the European Union reduces some boundaries (when it comes to payments and other aspects of our lives), but some other differences, however, will always remain.
Jeremy Fleming states on EurActiv that cultural differences might be one of the key challenges when it comes to the migration towards a Single Euro Payments Area (SEPA). For example, when comparing the United Kingdom to Italy he notices that the British use payment cards much more frequently than any other Europeans.
According to an index compiled by MasterCard, the UK ‘much more resembles the Unites States, Canada and Australia than it does Germany, France and Italy.’
Speaking of Italians; they prefer cash, according to the index. It will probably take many years before this country will embrace cards – let alone mobile payments: “Consumers will require significant education and marketing efforts to raise both their awareness of and willingness to use the technology.”
The willingness to adopt new technologies and standards can be defined culturally. Social scientist Geert Hofstede defined four dimensions on which cultures can differ, based on extensive research amongst IBM employees all over the world. One of these dimensions appears to have a direct impact on the perceived risk and benefits of new standards and technologies: uncertainty avoidance.
This dimension expresses the degree to which the members of a society feel uncomfortable with uncertainty and ambiguity. Societies that tend to avoid uncertainty, try to stick to proven rules and behaviour. It is hardly surprising that Italy scores very high on the uncertainty avoidance index (UAI), contrary to the UK:
Does this mean that countries with a high tendency towards uncertainty avoidance will be more hesitant towards SEPA? That can’t be determined without further scientific research. But national administrations and banks in these countries do have an important role to play when it comes to education. It is not very likely that inhabitants in risk-averse countries will easily embrace changes to the way they transfer money when they are not aware of its benefits.
According to Hofstede: “The fundamental issue here is how a society deals with the fact that the future can never be known: should we try to control the future or just let it happen?” Although the introduction of SEPA does imply a significant change in the short term, one of its long-term goals is to increase stability in the Eurozone. This argument can be a powerful tool to convince inhabitants of risk-averse countries of the merits of SEPA.