The result can be that an inexpensive solution – BankAxept – is supplanted in favour of more expensive solutions. In Denmark, merchants charge a fee to customers who use a credit card. A similar practice in Norway could keep down payment costs. The profit banks earn on the use of international payment cards is higher than on BankAxept. It is therefore likely that, in isolation, it is in the interest of many banks for customers to choose international payment cards. New European regulations that will set a cap on the fees issuers of payment cards can charge are in the pipeline. This will likely weaken banks’ incentive to promote international payment cards. Banks continue to lose money on payment services. The cost survey we are presenting today does show that banks’ cost coverage has increased somewhat over time. But income still amounts to only 76 percent of the costs associated with payment services. Banks lose money on all main types of payment instruments, except for international cards. The losses must be covered by income from other banking activities. Pricing that does not cover costs may be a conscious choice by banks. Some customers may believe that they should not have to pay for using their own money. At the same time, mispricing and losses weaken banks’ ability and willingness to promote efficient solutions and invest in new infrastructure. That is not a forward-looking approach. We must invest now to ensure efficient and secure payments also in the future.

With several layers of service providers, risk increases while at the same time becoming more difficult to uncover. In 2015, Norges Bank will evaluate the outsourced operations of key participants in the financial infrastructure in Norway. This assessment, too, will be based on international principles. 8 A fundamental prerequisite is that the owners of systems have the ultimate responsibility for operation. This responsibility also covers backup solutions. The owners’ responsibility does not change because all or parts of system operation are managed by others. Owners must therefore retain sufficient expertise in-house. Both for the system owner and the authorities, the ability to set requirements and follow up activities is more of a challenge the more remote they are. When parts of the financial infrastructure are operated outside of Norway, system owners should implement special measures to address these additional challenges. A situation must be avoided where infrastructure critical to Norway is affected by incidents in other countries. Norges Bank will give weight to these considerations in its supervisory role. Contingency preparedness The consequences of disruptions in a payment system may be more serious for society than for the individual operator. For that reason, the authorities set strict requirements for contingency preparedness. Contingency arrangements shall both reduce the likelihood of incidents and mitigate the consequences if an incident has occurred. The requirements for contingency preparedness may entail increased costs in the short term. In the longer term, adequate contingency preparedness is crucial for society. This is reflected in the trade-offs between long-term risk and short-term costs.