Treasury Management Internation Logo

ECB publishes second SEPA migration report and warns of risks of late changeover

Published 

– Migration progressing well for SEPA Credit Transfer, late for Direct Debit

– Last-minute migration poses operational risks for users and providers

– Everybody has to be ready by 1 February 2014

The European Central Bank (ECB) has today published its second report on migration to the Single Euro Payments Area (SEPA), analysing the state of play in euro area countries in creating a single market for credit transfers and direct debits in euro across Europe. The report also provides guidance on managing the transition process.

1 February 2014 is the deadline established by European law for euro area countries to migrate to the SEPA credit transfer (SCT) and SEPA direct debit (SDD) schemes. With only 100 days left to go, the changeover process is now entering a critical phase. The information compiled by the ECB and the euro area national central banks show that many key stakeholders have decided to migrate only in the last quarter of 2013, or even later. This approach generates operational risks and limits the ability to tackle any issues or unexpected developments that might arise during the changeover period.

“I have said this before and will repeat it: everybody has to be ready on 1 February 2014 or risk disruptions in their individual handling of payment orders,” said Benoît Coeuré, member of the Executive Board of the ECB, pointing out that this is also the position of the European Union Council and the European Commission.

“Since our first migration report, we have been emphasising the fact that both payments providers and users are responsible for being sufficiently prepared. And our message to them is still the same: don’t leave it to the last minute.”

Quantitative indicators of actual migration and qualitative indicators of the preparedness of stakeholders show that migration to the SEPA credit transfer (SCT) scheme is progressing well. A few countries in the euro area have already completed the process, while many others are progressing at a swift pace. However, as for the SEPA direct debit (SDD) scheme, most stakeholders will only be migrating in the last few months before the deadline. While the overall preparedness of payment service providers seems satisfactory, many of their customers, particularly small and medium enterprises, still face significant challenges in terms of being sufficiently prepared in time for the changeover.

Payment orders that do not comply with the legal requirements as laid down in the SEPA Migration End-date Regulation will not be allowed to be processed by payment service providers after 1 February 2014.

The report outlines some of the risks posed by a “big bang” late migration. These risks include capacity issues and bottlenecks on the side of the providers and software vendors at the end of the year, and a lack of time for end users to adapt to the payment service providers’ new standards as well as to test their own systems sufficiently.

“A successful migration will require considerable effort, so it is important to further strengthen communication and cooperation among key stakeholders and competent authorities at the national level”, added Mr Coeuré.

The report is available on the ECB’s website at www.ecb.europa.eu.

Further information on SEPA preparedness of stakeholders in individual countries is available on the ECB’s SEPA website at:

http://www.ecb.europa.eu/paym/sepa/about/countries/html/index.en.html

Most recent episodes

HSBC’s Sibos Spotlight: Investing in the Future – from Diversity to Green Deposits

In the final instalment of HSBC’s Sibos Spotlight, Eleanor Hill (TMI) invites Nadine Lagarmitte and Suraj Kalati (HSBC) to consider how corporates’ attitudes to...

25:12

HSBC’s Sibos Spotlight: The ESG Landscape – what every treasurer needs to know

In the third edition of HSBC’s Sibos Spotlight Podcast series, TMI’s Eleanor Hill invites Farnam Bidgoli (HSBC) to provide an in-depth overview of the current ESG...

16:24

The Path to Transformational Global Cash Visibility

Davina Bradley (CEVA Logistics) and Conor Deegan (CashAnalytics) join TMI’s Eleanor Hill to explore how treasurers can transform their cash visibility and forecasting within their business in a matter of weeks using a...

33:16

HSBC’s Sibos Spotlight: Embedding ESG in Trade and Supply Chains

In the second podcast from HSBC’s Sibos Spotlight series, TMI’s Eleanor Hill speaks to Surath Sengupta (HSBC) about embedding ESG into trade and supply chains....

20:58

Lost in Transaction: Overcoming Payments Pitfalls

From simple errors to duplicates, fraud and sanctions violations, there are a number of areas where payments can go wrong – especially in the real-time environment. In this podcast, TMI speaks to Andrew Ferrao...

34:25

HSBC's Sibos Spotlight: Central Bank Digital Currencies

The first edition of HSBC’s Sibos Spotlight series sees TMI’s Eleanor Hill joined by Mark Williamson and James Pomeroy (HSBC) to discuss the hot topic of Central Bank Digital Currencies (CBDCs). Our guests discuss...

25:48

Payments Vision 2025: The Inside Track

Wim Grosemans, Steven Lenaerts (BNP Paribas) and Wim Raymaekers (SWIFT) join TMI’s Eleanor Hill to outline their vision for the payments landscape in 2025. Our guests consider how recent developments such as instant...

28:21

Stepping Out from the Shadows

“Treasurers needs to step out of the shadows and into the sunshine in terms of their strategic contribution.” claims Zitah McMillan, Co-Founder and CEO, Predictive Black. In this podcast, hosted by TMI’s Eleanor Hill, our guest declares that the...

16:54

Why the ‘One Size Fits All’ Approach is Outdated - A Cash Segmentation Treasury Masterclass

With the ongoing low interest-rate environment and increasing regulatory change, it’s more important than ever for treasurers...

23:55

Instant Payments: Instant Rewards

TMI’s Eleanor Hill sits down in the virtual TreasuryCast studio with J.P. Morgan’s Global Head of Real-Time Payments, Cyrus Bhathawalla, to discuss how treasurers can capitalise on the evolving nature of real-time payments. Our guest contemplates the elements...

23:55