Technology analyst firm Datamonitor has found that UK-based institutions are falling dangerously behind their European counterparts in preparing for European Monetary Union. Research commissioned by technology services company, Sema Group Plc, suggests that 35% of firms do not believe that EMU will have an impact on their business. It could only add that the majority of firms in the rest of the European Union – Germany, the Netherlands, France and Belgium are prepared. Only Italy is keeping up the rear with the British. According to Sema the move to a single currency is a forgone conclusion, even if the UK misses the first entry point in January 1999, any company that trades in Europe will need to adapt both their IT systems and business process to cope with the transition, it says. It added that German banks are looking to provide Euro-mortgages when EMU arrives and will have the edge on the British. It also said retailers were increasingly moving into financial services and by being prepared for EMU they could leapfrog the current banking establishment. However Barclaycard, global credit and financial organization headquartered in London, is untroubled by EMU. It said that though it understood EMU was still a big issue, it was more concerned with the year 2000 configuration problem. We are in the process of assessing what needs to be done to prepare for a possible EMU, but we already deal in multiple currencies on a daily basis so I doubt one more will prove to be that much of a problem, said Ian Baldwin, lead IT analyst at Barclaycard. The newer UK-based financial institutions appear to be more concerned with establishing themselves within their home market. Both supermarket chain Sainsbury’s and insurance and pensions group, Virgin Direct say they have no immediate plans to enter the European market. While the EMU creates an exciting opportunity for us to trade in Europe, the first stage will be to start up a UK-based banking service before we venture out to the continent, said Martin Campbell, product development manager at Virgin.
