Deadline is fast approaching
The February 14 mandatory deadline for migration to SEPA is fast approaching and many businesses are still unaware of the scheme. This pan-European initiative aims to create a single market for euro payments, where cross-border payments can be made easily and efficiently as they are within nations. Estimations reveal that SEPA could save up to EUR123bn within six years of migration, benefitting clients, banks and businesses.
The survey conducted by ISME, which involved a sample of 5,000 SMEs, revealed that just one in four SMEs in Ireland are aware of the potential impact of SEPA on their business, and 64% have not received any information on the scheme. Of the 36% who received information, half was from their bank, 31% from a business group, 8% from a Government department and 6% from their software provider.
Worryingly, 63% were unaware of the mandatory deadline for SEPA compliance of 1 February 2014. With the deadline just 9 months away, only one in ten businesses have discussed implementation with their bank, and only 7% with their software provider. In terms of implementation and readiness, 71% had not started, 28% were in the early stages of planning or implementation, and just 1% said they were already SEPA compliant.
A SmartDebit spokesperson commented: “The research is concerning due to the risk of delay or even failure of payments to and from customers and suppliers. Awareness levels and guidance on what needs to be done to become SEPA compliant is critical to stakeholders.
SEPA Direct Debit replaces the existing domestic direct debiting schemes and presents the opportunity for financial institutions to offer a pan-European Direct Debit product in euro. This represents a significant innovation as, for the first time, allowing organisations, to conveniently collect payments in euro from their customers whether domestically or from other SEPA countries.”
Whitepapers
Related reading
Central banks best suited to issue digital currencies
By Aaran Fronda A recent report by the Official Monetary and Financial Institutions Forum (OMFIF) said that central banks rather than private ... read more
Instant payments: innovations inbound for corporates
In 2020, instant payments look set to continue their current trajectory to become the biggest trend in payments. While these schemes already offer numerous benefits to corporates, leveraging innovations such as APIs and request to pay will go some way to unlocking their full potential, argues Michael Knetsch
Obstacles exist for banks to meet ECB’s instant payments goal
The cost of joining instant payment platforms will be one of many hurdles banks and payment services providers must overcome to meet ... read more
Banks must be aware of “biases” in data used to train ML models
Financial institutions need to be conscious of biases in the historical data that is being used to train machine learning (ML) models, ... read more
