Businesses in the Eurozone are currently more than 80 per cent of the way through the migration window to SEPA standards, while around 30 per cent of credit transfers and two per cent of direct debits are now SEPA-compliant
But businesses must move to international standards to become SEPA compliant. This includes:
• International Bank Account Numbers (IBAN) – ISO13616.
• Bank Identifier Codes (BIC) – ISO 9362.
• ISO20022 XML payment file format.
Businesses which currently use IBAN-format account numbers have reduced error rates (4.6%) in comparison with those using domestic account numbers (12.7%), however this still represents a significant increase in failed payments over the one to two per cent currently experienced by European organisations.
Migrating existing customer records to the IBAN standard will be a huge challenge given the sheer scale of records which will need to be updated and, as a result, large creditors face significant challenges to migrate and maintain SEPA-compliant mandate information.At the same time, many Bank Identifier Codes (BICs) are also invalid or out of date following numerous bank mergers, reorganisations, defunct branches or structural changes.
Businesses must look to use, leverage and embed data validation within their systems and processes if they are not to incur significant costs as their operating countries move to SEPA.
Given the limited time to migrate, organisations must start their SEPA programmes now or risk business continuity through non-compliance.
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