by Federica Scopelliti, International Cash Management Sales Italy, UniCredit S.p.A.
The EU’s objective to create a common European payments market will officially take a step forward with the mandatory adoption of SEPA instruments within the European economic area from February 2014. This is intended to be the starting point of a market where all players will be able to make and receive payments in an easy and secure way, at cost and efficiency levels equal to those currently existing in the national territories.
However, this intention may not be realistic when considering some existing national payment markets. We do not wish to under-rate the importance of the creation of a single euro payments area: on the contrary, we recognise the tremendous impact that SEPA will have in achieving the vision of the EU as a single body (rather than a multitude of single states) by enabling all market participants (individuals, corporates, public entities, etc.) to send EUR payments under the same standards, rights and obligations, regardless of where they are located in Europe.
Aside from the pan-European perspective and considering instead what SEPA will imply at a country level, its impact can be viewed rather differently. For example, in Italy, the increased flexibility offered by SEPA has been effectively accomplished already at a domestic level through the introduction of new, standardised market practices and formats, such as the introduction of IBAN as the unique identifier of a bank account, that was deployed in Italy more than two years ago.
The same applies to direct debits. It is undoubtedly the case that some features of the SEPA Direct Debit (SDD) scheme are less sophisticated than some of the national direct debit schemes, so SDD cannot be seen as a step forward. Italy’s national DD scheme (RID) is based on both creditor/debtor-driven mandate flows, with an efficient and mandatory electronic mandate management service, AEA – Archives Electronic Alignment. The SDD scheme lacks the efficiency and automation of this service. The AEA follows the entire lifecycle of a direct debit mandate, from the initial request for debit authorisation, to the possibility, for example, that the debtor account no longer exists.