The European Union wants to develop a single uniform European payment platform to improve trade between consumers and companies in Europe. This will enable payments in European countries using a single account and a single set of payment options. All legal and technical barriers for pan-European money transfers have already been eliminated.
The European Commission wants to use SEPA to bring an end to the inefficient patchwork of electronic payment standards in the EU, which currently increase the costs incurred by companies. SEPA rules represent uniform requirements and technical standards that can be used in payment products for Euro transactions in Europe. These rules have been formulated by the European Payment Council, where European banks are also represented.
Mandatory modifications for companies
Companies are still not aware of the urgency, even though the migration deadline has now been set for 1 February 2014. SEPA will have many consequences for companies. Current business processes are no longer appropriate and systems and payment files are being upgraded. Payment processing is also being modified so payments can continue to be processed. Processes for managing payment collection contracts need to be expanded. Within the market, we see that such processes vary in time between 6 months and 2.5 years.
Opportunities for companies
SEPA also offers opportunities for optimising cash management. People will need fewer bank accounts in the future and it will be possible to centralise money in one location. Payment transactions between clients and suppliers are completed faster. There has been an improvement in the visibility of cash and working capital. And all this is helping to reduce costs.