by Garry Young, Director of Corporate Services and SaaS, Logica
With the European Commission currently proposing 2013 as the date to move from legacy euro direct debit schemes to SEPA Direct Debit (SDD), corporates across Europe need to plan for the impact of switching off national schemes. While SDD holds much promise, it also brings with it a set of challenges which will call for new business processes and system upgrades. The scheme will also place responsibility for managing mandates with the corporate – a significant change in many countries. Garry Young, Director of Corporate Services and SaaS at Logica, examines the opportunities available to forward-thinking corporates, and how they can find business benefit in SEPA.
SDD is coming
When SEPA Direct Debits come into force in 2013, corporates are going to face some big challenges. Some organisations still believe that SEPA won’t have any effect on them at all, especially those operating only in domestic markets. As a result, SDD has barely registered on their radar – and many continue to see the regulation only in terms of the spend required to comply.SDD’s shift of responsibility for managing mandates to corporates represents a major shake-up in many countries and will call for new business processes and technology upgrades. It’s not all bad news though, and opportunities are out there for corporates which approach SDD strategically – such as gaining greater visibility and control of their cash.
Changes for corporates
To start with, SEPA as a whole can boost the efficiency of a firm’s payments processes. Right now, international firms operating collections across the Eurozone have to work with different direct debit schemes in each country. By moving to SDD for euro collections, they’ll just have one set of requirements to manage, allowing them to standardise process and rationalise infrastructure.