Good things are happening in British business
Find out how some of our customers have evolved their businesses in innovative ways.
Important payment industry change within the Eurozone
For ten years, Europe has been developing the Single Euro Payments Area (SEPA) with the aim of simplifying non-urgent payments within the Eurozone, providing consumers, businesses and institutions the same basic conditions, rights and obligations when paying and receiving euro, whether across or within national boundaries.
The SEPA End Date regulation (Reg EU260/2012) has confirmed the deadline by which banks and businesses need to make the changes needed to achieve compliance. SEPA End Date signals the migration of national Euro Credit Transfers and Direct Debit schemes to a set of common technical requirements, standards and timeframes across the 33 SEPA countries.
There are two key dates:
How will these changes impact UK businesses?
The key consideration for UK businesses is where their bank accounts are domiciled. It is the location of these accounts and not the company location that determines the relevant deadline.
The regulation does not impact Sterling payment schemes e.g. CHAPS, BACS and Faster Payments (FPS).
Additionally, if you are an existing user of Lloyds SEPA Credit Transfer and SEPA Direct Debit service, these services will not be impacted by the 1st February 2014 regulation changes.
As the first deadline grows nearer you may be approached by your counterparties in Europe for additional payment information, such as International Bank Account Number (IBAN), which can be found on your bank statement.
Additionally, if you operate euro accounts with different banks in euro member states, you should contact them to understand how they are preparing for SEPA compliance. Some banks will seek to adopt rigid standardisation in their processes whilst others may look to develop additional services such as conversion from legacy schemes to SEPA (ISO 20022 XML) file formats and IBAN validation.
This is of course a major change in the payment systems within the euro member countries and the industry will be working hard to minimize any potential disruptions, such as delays to payments that could come out of such a change.
Please contact a member of your Cash Management & Payments Sales team/International Business Manager or your Relationship Manager, if you wish to discuss in more detail the impacts and opportunities arising from this major industry change.