Are you ready for SEPA?
Finance shared services
The Single European Payments Area will be going live in just over 12 months, in February 2014. As a shared services organisation and therefore a key user of electronic payments, you will need to be ready for the changes. But are you fully aware of how SEPA will impact your day to day working life?
SEPA aims to simplify and harmonise bank transfers across the 27 member states, plus Iceland, Liechtenstein, Monaco, Norway and Switzerland, by replacing the numerous costly and incompatible national payment schemes currently in use with a single, unified scheme to cover the approximate 70 billion transactions made every year in the EU. This adoption of standardised payment instruments will offer businesses increased protection through increased regulation and encourage market standards.
The system will cover the 70bn electronic payment transactions (including e-invoicing) that occur across these 32 countries every year (Germany, France and the UK being the top contributors to that number). Juergen Bernd Weiss, Principal Research Analyst at Gartner, commented that it will be “one of the largest projects in the history of pan-European monetary transactions”.
But how will the changes affect European businesses?
Essentially, all companies sending or collecting payments in euros must be able to send SEPA-compatible debit and credit transactions to their banks using XML and settlement instructions must include the IBAN and BIC.
This is important for finance shared services organisations in particular, as ERP systems used in accounts payable and accounts receivable functions are often involved in creating electronic payment documents.
However, the challenges presented are not just technological. Significantly, in terms of business administration, all customer and supplier records must include accurate BIC and IBAN numbers. Preparing for SEPA, therefore, will not just involve technological implementations and reconfigurations, but whole organisational shifts.
“Banks, businesses, and public authorities will have to invest heavily between 2012 and 2014 to upgrade software, revise internal procedures and migrate customers and suppliers from national payment schemes to SEPA”, warned Leo Lipis, Analyst at CEB TowerGroup.
The impending SEPA deadline can therefore been seen a great opportunity to centralise, streamline and standardise processes and information flows affected by SEPA. By implementing the necessary changes to your business through shared services, you can spread the cost of the infrastructure, applications, maintenance and management.
To ensure that you are SEPA ready, register now for our in-depth webinar:
6 must-dos to ensure you have a ‘Get SEPA Ready Plan’, taking place on 30th January 2013 at 15:00 GMT.