sepa 2016: regulation requirements and …...sepa 2016: regulation requirements and solutions guide...

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SEPA 2016: Regulation Requirements and Solutions GuidePrepare for Increased SEPA Compliancy and ‘IBAN Only’ Standards

PAYMENT SOLUTIONSPowered by Bankers Almanac

Get Ready for SEPA 2016As of August 2014, all eurozone countries were required to comply with the new Single Euro Payments Area (SEPA) regulations. This phase of the regulation has taken place, building a strong foundation for integrated and harmonised euro payments.

2016 brings additional SEPA requirements that will continue to impact banks, businesses, and payments service providers (PSPs) who process payments in the region.

How are you affected by the next phase of SEPA requirements? Act now to ensure that you are ready to address the new challenges of 2016.

1 FebruaryThe ‘IBAN only’ rule allows payment service users to submit an International Bank Account Number (IBAN) for a SEPA payment instruction without having to provide the related BIC. This means that the payment service provider must be able to determine the BIC based on the IBAN only.

In addition, organisations have to ensure that any legacy account numbers for payees are already converted to the IBAN standard. Exisitng BBANs need to be checked against multiple algorithms before being forward-fitted into IBANs.

If mandates need to be re-executed for direct debit instructions, compliance may also still require approaching clients and vendors to re-initiate these mandates for these instructions. The language in these covenants also needs to reflect the most current set of SEPA rules for debits and credits.

31 October

Non-euro countries that are part of SEPA such as Denmark, Sweden, and the United Kingdom will now need to comply with SEPA for their euro payments by the 31 October 2016 end date.

On this date, all existing national euro credit transfers and direct debit schemes will be replaced by the SEPA Credit Transfer (SCT) and SEPA Direct Debit (SDD) schemes.

After this time, banks and PSPs will no longer be able to transfer non-compliant euro payments to clearing houses and businesses within the expanded SEPA zone.

Non-euro countries and territories that need to comply with SEPA by October 2016

Bulgaria, Croatia, Czech Republic, Denmark, Guernsey, Hungary, Iceland, Isle

of Man, Jersey, Liechtenstein, Monaco, Norway, Poland, Romania, San Marino,

Sweden, Switzerland and the United Kingdom

Key Dates in 2016

/2 Accuity / SEPA 2016: Regulation Requirements and Solutions Guide

2016* http://www.ecb.europa.eu/press/pr/date/2014/html/pr140120.en.html** http://www.europeanpaymentscouncil.eu/index.cfm/newsletter/polls/† EU Parliament’s press release of 14 February 2012 announcing regulation 260/2012‡ This covers the territories of France that are not Treaty of Rome territories (Mayotte, Saint Barthélemy, Saint Martin [French part], Saint Pierre et Miquelon)

The benefits of SEPA compliancy

€100bn More efficient payment transfer

processes from the harmonisation of payment services across SEPA, saving the industry more than €lOO billion† in the next six years

Greater consolidation of payments and better liquidity management as corporates streamline and reduce the number of bank accounts held in euro

Increased standardisation and lower bank fees

In your view, what is the main

advantage for non-consumer payment

service users resulting from migration

to harmonised SEPA payment schemes

and technical standards?**

Streamline back office processes and, consequently, reduce costs

Collect direct debit payments based on the new harmonised SEPA Direct Debit Schemes across all SEPA countries

Generate efficiencies with implementation of the ISO 20022 message standards

Centralise cash management

Consolidate number of bank accounts required to manage payment business

41%

24%

14%

12%

9%

71.5 billion electronic SEPA payments per year

Existing national payment systems decommissioned to create one European-wide ACH system for euro transfers

17

71.5bn

3IBAN: the account number standard

BIC: the routing instructions for IBAN

ISO 20022 XML: used for remittance data exchange between banks

Standards for SEPA payments

Since ‘IBAN only’ has come into effect in February, banks and payments service providers (PSPs) need to match the necessary SWIFT/BIC when given only an IBAN from their clients. Given this extra burden, banks and PSPs need to ensure they can quickly and effectively match IBANs to their corresponding BICs to accurately process payments.

SEPA 2016: Regulation Requirements and Solutions Guide /3

IBAN-compliant countries and territories

Single Euro Payments Area (SEPA) compliant countries and territories

EU, but non-euro countries that will be included into the SEPA-zone with the

October 2016 deadline

European, but non-EU countries that will be included into the SEPA-zone with

the October 2016 deadline

Åland Islands • Albania • Andorra • Austria • Azerbaijan • Azores • Bahrain • Belgium • Bosnia and Herzegovina • Brazil • British Virgin Islands • Bulgaria • Canary Islands • Ceuta and Melilla • Costa Rica • Croatia • Cyprus • Czech Republic • Denmark • Dominican Republic • Estonia • Faroe Islands • Finland • France • French Guiana • French Polynesia • French Southern Territories • Georgia • Germany • Gibraltar • Greece • Greenland • Guadeloupe • Guatemala • Guernsey • Hungary • Iceland • Ireland • Isle of Man • Israel • Italy • Jersey • Jordan • Kazakhstan • Kosovo • Kuwait • Latvia • Lebanon • Liechtenstein • Lithuania • Luxembourg • Macedonia • Madeira • Malta • Martinique • Mauritania • Mauritius • Mayotte • Moldova • Monaco • Montenegro • Netherlands • New Caledonia • Norway • Pakistan • Palestine, State of • Poland • Portugal • Qatar • Réunion • Romania • Saint Barthélemy • Saint Martin • Saint-Pierre et Miquelon • San Marino • Saudi Arabia • Serbia • Slovakia • Slovenia • Spain • St. Lucia • Sweden • Switzerland • Tunisia • Timor Leste • Turkey • United Arab Emirates • United Kingdom • Wallis and Futuna

Global Migration to the IBAN In October 2016, eighteen additional countries in Europe will be required to comply with SEPA and IBAN standards.

Additionally, IBAN standards are increasingly being adopted by countries outside of the SEPA zone, requiring IBAN-compliant payment messages for efficient payments origination and payment straight-through processing.


Are You Ready for ‘IBAN only‘?February 2016 marked the start of ‘IBAN only’ within the SEPA zone. Moreover, even countries outside Europe utilise this standard. Make sure you have the tools and data you need to send and process payments when you are given only an IBAN.

Perform a country assessment List all the countries you operate in to gauge the impact of ‘IBAN only.’ This will encompass both euro and non-euro countries that fall under SEPA.

Assess your business systems Determine which business systems and processes will need to be modified to accommodate ‘IBAN only’ requirements.

Identify payment instructions For payment service providers (PSPs), determine what the requirements are for payment instructions from the clearing mechanisms being used for payments. For payment service users (PSUs), determine the readiness of your PSPs in terms of SEPA compliance.

Centralise payment operations instructions With increased standardisation, this may be the time to consider payment centralisation. As such, assess opportunities to centralise payment operations under payment hubs.

Research solution providers When seeking services, ensure that providers can accommodate internal security policies. Can solutions be provided that do not involve the exchange of your data outside of your network if that is an important concern for you?

Convert legacy data Assess what legacy information needs to be converted from BBAN into IBAN. In what formats is this data maintained?

Consider future data needs Consider your needs not only for legacy data but also for any future data. Extending the ability to convert data to SEPA standards (BBAN to IBAN) can be a value-added service for your external customers. Determine what technical approach would most benefit your environment (e.g., web services).

Establish data readiness For PSPs, assess readiness for remittance data exchange via the ISO 20022 XML format. For PSUs, assess the formats in which your PSP can accept your payment information. Determine if you need to submit data via ISO 20022 XML or if your PSP can accommodate alternate formats.

Assess mandates Assess any mandates that need to be reissued for direct debit payments.

Prepare for future developments Make sure that PSPs and other providers are on top of any new developments in SEPA.


Our Solution for SEPA: IBAN COMPLETENo other provider within the marketplace is able to provide the critical aspects of IBAN validation and conversion that Accuity offers within its IBAN solutions.

Convert IBAN based on legacy data (bank branch code and account

number or BBAN)

Generate IBAN check digit

Checksum value for legacy account number based on bank-specific rules

Validate ISO country code is IBAN compliant

IBAN check digit

Bank branch code value within the IBAN

Length and format of legacy account number

Checksum value within the legacy account number

IBAN length (specific to each country)

Provide Correct SWIFT/BIC for the IBAN

Override or routing SWIFT/BIC for the IBAN, when needed

Accuity will:

G B 0 4 N W B K 6 0 2 1 4 0 0 0 0 0 0 0 0 1


/ IBAN Complete is CONFIGURABLE

One comprehensive solution.Multiple delivery options.

Access the online reference toolFacilitate validation and conversion of key IBAN

payment information, via single look-up or batch.

Connect your systems to our data applicationUsing your current systems, seamlessly connect

to our hosted database for the most up-to-date

information.

Embed our IBAN expertise into your systemsDeploy our application in your own environment

for increased control and added security.

Send files securely via SFTPSend and receive files via SFTP for secure and

automated batch processing.

Engage with AccuityLet us review, clean-up and enhance your IBAN

payment data for improved rates of payment STP.

Access the online reference toolFacilitate validation and conversion of key IBAN

payment information, via single look-up or batch.

Connect your systems to our data applicationUsing your current systems, seamlessly connect

to our hosted database for the most up-to-date

information.

Embed our IBAN expertise into your systemsDeploy our application in your own environment

for increased control and added security.

Engage with AccuityLet us review, clean-up and enhance your IBAN

payment data for improved rates of payment STP.


/ Our Data is CREDIBLE & TRUSTED

Only Accuity has the following strategic alliances:

Official register of ABArouting numbers since the role

was incepted in 1911

Official provider of the SEPA adherence

database

Accuity is the official provider of the EBA Euro

Priority PaymentScheme central registry

Official provider of the IPSO’sdirectory of National Sort

Code database

Accuity has been providing solutions to banks and businesses worldwide for more than 175 years175

15k

1839 2014

We have 15,000 customers worldwide in 165 countries

Accuity Leads the World in Payment MessagingAccuity is the official provider of the centralised register for the European Payments Council SEPA Credit Transfer (SCT) and SEPA Direct Debit (SDD)

schemes. We have been collaborating with the European Payments Council, the

European Central Bank and the SEPA National Adherence Support Organisations

in all SEPA countries to create the European Banking Directory, which launched

February 2008. The directory stands as the definitive banking directory for SEPA.

Accuity also was first to market with an IBAN-to-BIC mapping tool in 2001 and

first to market with installed and hosted BBAN-to-IBAN conversion solutions.


OUR CLIENTS:

We are very happy with the outcome of the cleansing exercise that Accuity performed. It is great to have both our domestic and

international data cleansed, and we are delighted to have them SEPA ready. Gathering this data from our vendors ourselves would have cost us a lot of money, and would have taken us far too long to do, aside from the potential human errors that could have occurred. Accuity and Bank of America Merrill Lynch have a solution that I would recommend to anyone.

Eric O’Connor

Finance / Genzyme

When we began our project of migrating our in-house system to a new SAP accounts payable system, we found it challenging to find a provider with the capabilities we needed for the vendor’s bank records. Accuity’s

data services came through for us by not only validating, converting and processing 3,000 Bank Master records in Chinese but then also providing the correct National Routing Codes for those records and ensuring the migration went off smoothly and efficiently. We are extremely impressed and satisfied with the results that Accuity provided.

Anthony Mazzatti

Global IBM Accounts Payable Process Owner / IBM

Accuity facilitates SEPA payments, automating BBAN to IBAN conversion and validation.

Accuity’s IBAN solutions connect any IBAN with the appropriate SWIFT/BIC of the

beneficiary’s bank or the ‘assigned BIC.’ Accuity also provides the routing BIC for IBAN

processing, when applicable. This provides the critical data that needs to be included in a

payment message, ensuring efficient payment straight-through processing or decreased

amount of payment rejections.

Updates are made to our database from multiple sources† every day and we have been

collecting this information since 2003.

† Our quality payments data is collected and refreshed daily from feeds, RFIs, publishing keys, pro-active communications, new regulations, cleansings, memberships, and registries. We also have been the registrar for the ABA routing codes for over 100 years and European Payments Council SEPA Credit Transfer (SCT) and SEPA Direct Debit (SDD) schemes.

What Makes Us the Experts?


GETTING STARTED

Get on the path to SEPA compliance today:

Email: [email protected]

or go to www.accuity.com/SEPA

www.accuity.com Abu Dhabi / Boston / Chicago / Frankfurt / Hong Kong / London / Mumbai

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© 2016 Accuity. All rights reserved. All other company and product names, trademarks and registered trademarks used here are the property of their respective owners.

03.18.16

sepa 2016: regulation requirements and …...sepa 2016: regulation requirements and solutions guide...

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