OREANDA-NEWS. September 21, 2012. Eesti Pank's international procurement to update the interbank retail payment system was unsuccessful, since neither of the two tenders complied with requirements. In order to bring the retail payment system into line with the conditions of SEPA (Single Euro Payments Area), Eesti Pank launched a new procurement process. It will be a negotiated procedure with prior publication of tender notice, reported the press-centre of Eesti Pank.

In 2014, uniform payment terms will enter into force in the European Union, enabling people and companies make euro payments across the whole of Europe using one bank account and payment card. As a result, it is necessary to update Eesti Pank's settlement system for domestic interbank payments (ESTA), which settles an average of 100,000 payments worth around 125 million euro a day.

The first invitation to tender for a new retail payment system announced at the end of May received two tenders by the deadline of 7 September. Since neither of the tenderers submitted all the documents required to qualify, the central bank deemed the procurement procedure unsuccessful. "In addition to formalities, the tenders also had content-related shortages, the most important of which was incompliance with the Emergency Act," said Head of the Clearing and Settlement Systems Mihkel Nommela.

The new negotiated procurement gives tenderers 30 days to submit documents needed to qualify. Then follow negotiations with Eesti Pank in order to establish the tenderer that best meets the conditions set by Eesti Pank.

According to Nommela, the central bank opted for a new procurement format in order to increase the likelihood of the tenders complying with both formal and content-related requirements. In addition, negations accelerate finding out how favourable conditions tenderers are willing to offer.  The two most important criteria are speed of settlement and price. Currently, retail payments between banks move ten times a day and the central bank charges commercial banks just 3 cents per payment.

"Though commercial banks operating in Estonia do not have to participate in our retail payment system, it would be the best solution for the people of Estonia. First of all, a uniform system is more reliable in operation. Second of all, it helps ensure payments between banks move faster. Third of all, it means a more favourable price, since the more payments the system moves, the cheaper it is to maintain it. In a small country like Estonia, it is essential for the success of your system to make sure there is a sufficient amount of payments moving through it," Nommela explained.

The number of tenders will be clear in mid-October.