250 billion transactions per year in 2008. of this growth, card payments were the strongest driver. 4 in the european union, card payments reached a total of over 29 billion transactions in 2008, also growing at a rate of almost 9 %. 5 this shows the immense potential of this means of payment to generate revenue for the financial industry through growth, even at a time when interchange fees are under pressure. in my view, sepa offers tremendous opportunities for further harmonisation of the use of cards, making them an even more attractive means of payment. but, besides the harmonization of card standards, more competition in the european cards market can bring additional benefits to consumers. therefore, the eurosystem remains convinced that an additional european card scheme is needed. three initiatives are under way : payfair, eaps and “ monnet ”. the eurosystem has maintained close contacts with all these initiatives to create an additional european card scheme. we are pleased to see that one of the initiatives has recently started a pilot with a large merchant, and that another initiative is operational among some of its constituent schemes, especially for atm withdrawals. we are hopeful that these initiatives, whether separately or jointly, will come to fruition in the near future. in essence, for sepa for cards to become a success, card payments need to be positioned as a real alternative to cash : efficient, fast and guaranteed. this could and should be delivered by the already existing card schemes and the foreseen additional ones. however, this will not be enough. a successful sepa for cards also needs the harmonisation of technical standards, basic business rules and certification practices across schemes. only this will bring an integrated cards market into effect. sepa by its nature of harmonizing the retail payments market will promote more competition and hence will be a key driver of innovation in the market. new developments have already taken off in the field of esepa. esepa means the provision of various retail payment services by means of electronic channels – such as internet – in order to offer benefits to payment service users in the form of easier access, better functionality and a more attractive user experience. more and more companies and consumers operate online. hence, the market needs to create european e - payment – or online – solutions, which will bring even more efficient and transparent trading at the retail level. for example, an “ e - payment ” is an internet banking payment. the web - merchant receives a payment guarantee confirmation in real -

further adjustments to the fair values of these assets become necessary, thereby perpetuating the “ downward dynamics ”. 1 these dynamics may in the end have adverse implications for the “ real economy ”, e. g. banks may further curb their lending to the economy. in this context, the potential impact of fair value accounting on behaviour, asset price dynamics and subsequently on financial stability should not be underestimated. pre - crisis provisioning practices delayed the recognition of credit losses inherent in loans. accounting rules require a specific trigger event, such as a default in payment to take place before allowing an entity to create provisions for credit losses. as a result, major write - offs usually accumulate during severe downturns when the inherent credit losses actually materialise, adding further stress to the financial system. hence, a more forward - looking provisioning methodology should be developed. this has also been a recommendation of the g20 leaders. in this context, the ecb welcomes the recent iasb proposal for an expected cash flow approach. despite some operational challenges that need to be resolved before its final adoption, this approach allows for a timelier recognition of expected credit losses, thereby contributing to mitigating pro - cyclicality. in this context, it should be noted that the basel committee has recently developed an approach which aims at reducing the complexity of the iasb ’ s approach. the ecb urges the iasb to work together with the basel committee with a view to developing a workable solution to a more forward - looking provisioning approach. this is also a good example of where the objectives of high quality accounting and safeguarding financial stability complement each other. on that note, let me finally underline that the ecb acknowledges the work of the iasb and welcomes the progress that has been achieved in the accounting framework. we look forward to continuing the intense dialogue with the iasb on the remaining phases of the financial instruments ’ project, as well as other accounting areas that may be of importance from a regulatory perspective. it should be mentioned that the same dynamics may apply in a boom, albeit in the opposite direction, resulting in increasingly “ optimistic valuations ” and thereby fuelling additional lending. as regards the convergence between the american implementation and the ifrs rules, which is your general view? more precisely, on which technical / conceptual points europe will not give up? one of the key lessons to be learnt from this crisis is the need for international accounting convergence. towards this aim, g20 leaders have