Legal constants and the ‘constant’ outside of the law: Mobile payments in comparative perspective under European Union law
| Author | Daniele D’Alvia |
| Published date | 01 June 2021 |
| Date | 01 June 2021 |
| DOI | http://doi.org/10.1177/1023263X20987190 |
| Subject Matter | Articles |
Article
Legal constants and the
‘constant’ outside of the law:
Mobile payments
in comparative perspective
under European Union law
Daniele D’Alvia*
Abstract
This article aims to determine whether mobile payments can be characterized by a legal con-
stant, or common legal meaning. Indeed, mobile payments are a new form of payment system
that is shaping the new economy of financial markets. Generally, they are part of the Fintech
phenomenon, and they are specifically regulated inEurope,interalia,underthePaymentSystem
Directive and the Regulation on Multilateral Interchange Fees. Nonetheless, those secondary
hard law acts do not include any compulsory legal definition for mobile payments, which remain
undefined and conventionally identified as means of proximity or remote payments. With that in
mind, the article introduces for the first time in comparative law a new concept that aims at
discovering meanings rather than similarities and differences that are irremediably limited to a
merely descriptive function. To this end, the article argues that each time the constant outside of
the law is subsequently recognized as ‘legal’, it becomes a legal constant, which is in turn capable
of effectively revolutionizing the same study of mobile payments as well as of comparative law
tout court.
Keywords
Banking regulation, competition law, comparative law, European Union law, financial regulation,
mobile payments.
* Queen Mary University of London, Lincoln’s Inn Fields London, UK
Corresponding author:
Daniele D’Alvia, Queen Mary University of London, Queen Mary University of London 67-69 Lincoln’s Inn Fields London,
E1 4NS, UK.
E-mail: d.dalvia@qmul.ac.uk
Maastricht Journal of European and
Comparative Law
2021, Vol. 28(3) 332–355
ªThe Author(s) 2021
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DOI: 10.1177/1023263X20987190
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1. Introduction
Mobile commerce is the natural successor to electronic commerce, and it is predicted that mobile
payment (‘M-payment’) is the future alternative to cash,
1
representing a suitable technology for
new consumers’ necessities.
2
Currently, no compulsory legal definition of mobile commerce is provided by European and
international law. Therefore, a conventional definition may be adopted to describe mobile com-
merce and the way in which mobile commerce involves a transaction that is carried out between a
merchant and a customer, by which the latter is entitled to purchase goods and/or services through
wireless handheld devices.
3
Within this context, mobile payment is a current feature of modern economies and an evolved
form of e-payment schemes which promote mobile commerce.
4
Indeed, the most important mar-
kets where the diffusion of mobile commerce is reaching a peak are those of non-developing
countries where the majority of the population does not hold a bank account and credit cards,
therefore financial services are commonly delivered by virtue of mobile phones. On the other hand,
in developed countries mobile payment solutions can appear less attractive because mobile phones
and devices have to compete with debit and credit cards as payment instruments. Kenya in
particular is a developing country where since 2007 mobile services have been revolutionized
by the merchant M-PESA, whose numbers of transactions processed between July 2016 and July
2017 amount to 1.7 billion, plus today in Kenya there are over 120,000 M-PESA agents to allow
people to exchange cash for virtual currency, etc.
5
The success of M-PESA shows that mobile
payments are an efficient tool to manage payments and purchase goods and services as well as
transfer money.
6
This opens the discussion for the evolution of retail payments law that especially in Europe
seems to be focused on what has been defined as a ‘regulation for competition’.
7
However, it is not
only a question of competition between different payment instruments; the diffusion of mobile
1. N. Guthrie, ‘The End of Cash?Bitcoin, the Regulators and the Courts,in Banking and Finance Law Review’,29 Banking
and Finance Law Review(2014), p. 355; D.S. Evans, et. al.,‘Paying with Cash: a Multi-CountryAnalysis of the Past and
Future of the Use of Cashfor Payments by Consumers’ SSRN (2013) http://dx.doi.org/10.2139/ssrn.2273192.
2. Y. Au and R.J. Kauffman, ‘The Economics of Mobile Payments: Understanding Stakeholder Issues for an Emerging
Financial Technology Application’, 7 Electronic Commerce Research and Applications (2008), p. 141.
3. Z. Radovilsky, Application Models for E-Commerce (Cognella Academic Publishing, 2015), p. 20; A. Chong, ‘Pre-
dicting m-commerce Adoption Determinants: A Neural Network Approach’, 40 Expert Systems with Applications
(2013), p. 523; A. Chong, ‘Understanding Mobile Commerce Continuance Intentions: An Empirical Analysis of Chinese
Consumers’, 53 Journal of Computer Information Systems (2013), p. 22. In particular, the author in the latter article
points out the differences between electronic commerce and mobile commerce in terms of advantages of the latter
because of the growth in wireless and mobile technologies; J. Wu and S. Wang, ‘What Drives Mobile Commerce?: An
Empirical Evaluation of the Revised Technology Acceptance Model’, 42 Information & Management (2005), p. 720.
The authors describe mobile commerce as: ‘(...) any transactions, either direct or indirect, with a monetary value
implemented via a wireless telecommunication network’.
4. S.L. Rutledge, ‘Consumer Protection and Financial Literacy: Lessons From Nine Country Studies’ Policy and Research
Working Papers’, Policy Research Working Paper WPS 5326 (2010), https://papers.ssrn.com/sol3/papers.cfm?abstract_
id¼1619168, p. 1.
5. T. McGath, ‘M-PESA: How Kenya Revolutionized Mobile Payments’, N26 Magazine (2018), https://mag.n26.com/m-
pesa-how-kenya-revolutionized-mobile-payments-56786bc09ef.
6. W. Jack and T. Suri, ‘Mobile Money: the Economics of M-PESA’, The National Bureau of Economic Research,
Working Paper 16721 (2011), p. 1288–1292.
7. A. Janczuk-Gorywoda, ‘Evolution of EU Retail Payments Law’, 40 European Law Review (2015), p. 858.
D’Alvia 333
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