moreover the liquidity and account management are decentralised in the sector of local governments. about 89 % of households has at least 1 payment account, and about 85 % of households has at least 1 payment card, but households still use cash mostly. the low usage rate of electronic payments is explained by the continued existence of traditional payment habits, lack of information, motivation and partly confidence. it may also happen that even in case of willingness to pay electronically, the lack of infrastructure hinders the use of payment cards. the infrastructure is still underdeveloped ; the spread of pos terminals is currently governed mostly by tourism in the countryside, while the branch offices of credit institutions concentrate clearly on larger settlements. the interchange fees account for about 0. 5 % of the payment card transaction value what seems to be higher than the limits undertaken by the 2 main international card companies ( mastercard and visa ) who dominate the hungarian market. both the use of non - cash instruments and the spread of pos terminals have been constantly growing, nonetheless the growth rate is less than desired, and it would take at least 10 – 15 years before we could reach the present status of the nordic countries. based on the results of the cost study and aimed at enhancing social benefits, the hungarian central bank has started a more active communication, as a neutral position would not facilitate the fast realisation of cost savings. in our view, all stakeholders should seek together the ways to influence payment habits and thus intervene into the individual decisionmaking on the choice of payment instruments. the hungarian central bank has therefore launched a social dialogue. the very first step in this direction has been a recent domestic conference held on the presence and future of the domestic payment industry, where we presented the results of the studies and ideas for influencing payment habits. i am convinced that much better is for the whole economy if the responsible authorities first measure, then analyse and thereafter regulate. unfortunately we see a lot of examples when regulation happens first without any measurement and analyses which leads to disturbances. before outlining some possible measures aiming at influencing hungarian payment habits, let me draw a parallel between the hungarian and european developments. neither the hungarian public sector, nor a very large number of european public administrations lead the process towards a more progressive payment pattern and sepa migration respectively. we know from the recent communication of the european commission, that the share of sepa credit transfers out of all credit transfers undertaken by public administration is below 10 % e. g. in the netherlands, italy

the hungarian intraday clearing project. is there a happy end? yes, there is. together with banks and giro, we are working hard to make the project to come through. seen retrospectively, there are a number of banks who are now already happy about the actual start of the project and thus they share with us the same vision towards a more integrated and efficient retail payments market. a mixture of talks, technological innovation, standardisation, self - regulation and legally binding regulation has been used, and in addition to this mixture we closely monitor the implementation of project and in due time, i. e. after the go - live date : 1 july 2012 we will control the compliance with the regulation. efficiency going to the second topic of efficiency let me start with a very popular research topic of the past years. in the last couple of years it is in fashion that central bankers publish so called cost of payments studies. one may raise the question whether it is a good or bad fashion. i definitely belong to that group of supporters, who perceive cost of payments surveys as a very important form of communication to policy - makers and strong underpinning why public welfare can warrant public policy intervention in these markets. in a free market economy, one has to prove – and not just say – that on the one hand the social costs of cash are higher than that of electronic payment instruments and on the other hand, the market alone – due to the strong externalities that exist in this field – cannot achieve social optimum. the hungarian central bank has therefore joined the pan - european survey on social costs of retail payment instruments. we have prepared our own analysis on the costs of hungarian retail payment instruments. we have done it, because the use of cash is excessive in hungary in comparison with other european countries. the value of cash in circulation corresponds to about 8 % of gdp in hungary, and partly we face the implications of the hidden economy. we need systematically collected and processed information on the use of various retail payment instruments and the related costs along the payment chain, to underpin our policy decisions. we wanted to be convinced of the lower social costs of electronic payments in relation to that of paper - or cash based ones. at the same time we have overhauled the payment habits of the hungarian public sector, and indentified the most in - effective areas in their payment habits. our key motivation was that payments by and from public sector account for about 30 % of retail payments in hungary. we have taken a snaps