SEPA Go Live – 4 Things You Need To Do TODAY! 2

With just under 3 weeks to go until the 1st August SEPA Go Live deadline, and keeping in mind the ECB SEPA Statistics for May 2014, there is no doubt that the 6 month deadline extension was absolutely essential. But collectively we’re not quite there, 100% SEPA compliant, yet. I’m guessing that any outstanding SEPA implementations at this point will have met with some kind of major unexpected road block that has prevented SEPA compliance 6 months after the official SEPA deadline.

Anyway we are where we are, and if you’re in the process of either starting (perhaps a ‘mini’ implementation) or wrapping up any other SEPA implementation I recommend checking out the following posts:

• IBAN & BIC – The Definitive Guide
• SEPA Credit Transfers
• SEPA Direct Debits
• Migrating to SEPA in 5 Easy Steps
• 5 SEPA Credit Transfer Go Live Checks You Cannot Miss

But at this last juncture you may not have enough time to change, test and deploy significant system changes such as:

• Changing your source ERP system to handle BIC and IBAN requirements
• Generating the required XML format for either SEPA Payments and/or SEPA Direct Debits
• Testing the generated XML formats with your banks and making any necessary changes in time

Add to this, the summer holiday period. We should not under-estimate the impact of going live with SEPA processing in the middle of the summer holidays. Your SEPA go live is likely to be impacted by the holiday period:

• Key project team members in your organisation or at your partner bank maybe on holiday
• Your end users who run the daily payments and or direct debit collections processes may not be available, and so you may temporarily lose valuable knowledge of the day to day process
• Your Treasury team may who will see SEPA credit and debits on the bank statement may also be understaffed, and may not know what to look out for – for example the SEPA Reason-Codes, R-Transactions, R-Messages

4 SEPA Go Live Tasks You Need To Do TODAY:

1. Talk to your bank!

• You may think this is obvious, but given that we have just talked about the holiday period, make sure your usual and key contacts are available over the next 3 weeks. If they are not, make sure you know and have the details of who to contact
• Let’s assume you are not going to be ready with the required SEPA XML format. In this case check with your bank what would happen if you were to submit a ‘legacy’ bank file format. Would your bank be able to convert the legacy file into a SEPA credit transfer? Perhaps you need to set up some rules and conversion values at the bank to enable this. Understand the bank fees for doing this. Even if the bank cannot perform conversion services, they may be able to point you in the direction of a provider who can support you. I’m sure external providers will happily support (and charge!!) you for conversion services.

2. Convert your legacy bank details to BIC and IBAN

• This is extremely important. If nothing else, you need to know your customer and supplier BIC and IBAN banks details
• Here again, I would recommend talking to your bank and understanding from them the best way to handle this conversion at such short notice
• External providers will happily work with you on this, but keep in mind the holiday period, the number of last minute requests external providers may be getting, and in turn their charge for this service
• If its viable, contact your key suppliers and customers asking them directly for their BIC and IBAN details
  • This may be as easy as identifying your top 100 suppliers and customers and giving them a call. You will of course need a way of validating the captured details, but this first step should be relatively straightforward

3. Apply for your SEPA Creditor Identifier

• Check out the post SEPA Creditor Identifier for the details
• In short, talk to your bank to kick start this application (where required) today
• Make sure you apply for a Creditor Identifier for all of the relevant entities
  • Before you say it, we all know that technically you only need 1 Creditor Identifier in the SEPA zone. But some customers may feel uncomfortable seeing a ‘cross border’ direct debit collection, and may in turn reject it or request a refund. Doing this at short notice make prompt questions and concerns from your customers, so go live first and handle the 1 Creditor Identifier code across Europe later

4. IF NOTHING ELSE, DO THIS….

Let’s assume the worst case scenario. Its 1st August, your SEPA go live project for whatever reason has not gone live. In the meantime, the business still needs to function and make payments and/or direct debit collections. The solution isn’t pretty, is labour intensive, but it will enable you to make payments / collections…..

• Note down all of the euro-currency bank accounts through which you are making payments and direct debit collections today
  • We all know that you can potentially make SEPA payments / collections through one bank account, but lets hold that thought and come back to it after SEPA go live
• Next, contact your bank and if you don’t already (I’m guessing 99% of you will have access) ensure you have access to their internet banking application
• If you already have access to the internet banking portal ensure, and where required request, access to manually enter SEPA Credit Transfers and SEPA Direct Debit transactions for all of your existing euro-currency bank accounts.
  • You may need to work with your bank or system administrators to grant this access
• Ensure that your approvers have access to approve any SEPA transactions too
• Lastly, test that your users can manually enter and approve SEPA transactions before the SEPA deadline

Entering payments into internet banking can be time consuming, but it will enable your business to make any critical payments and collections while you continue to address any issues with your SEPA implementation. As long as you have the BIC and IBAN details you’ll be good to handle SEPA Credit Transfers through internet banking. Similarly, for SEPA CORE direct debit collections, you’ll need the BIC and IBAN details and the Creditor Identifier that we have already talked about.

 Good luck!

If you feel that you may not be ready in time, I recommend starting the 4 above checks TODAY. They will help you through 1st August SEPA go live, and will ensure that your critical supplier payments and customer collections can continue uninterrupted. That’s my list of 4 SEPA things to work on TODAY, let me know if you think I have missed something important. Lastly, I wish you well with your SEPA implementation(s)!