In the weeks and months leading up to the 1 February, 2014 end date for Single Euro Payments Area (SEPA) compliance, much attention is being paid to how the effort to mandate efficiency in euro payments will affect banks and corporates across the 28-country zone.
While the 2014 deadline may not seem important to countries across the Americas, Asia Pacific and elsewhere, SEPA will be increasingly all encompassing.
While the deadline most directly impacts organisations inside the SEPA zone, it also affects any organisation making euro payments, regardless of location.
After the conversion date, SEPA will impact high-and low-value payments, supplier and consumer payments, payments routed through cross-border systems as well as payments settled in local systems for any corporate doing business anywhere in any of the SEPA countries.
As a result, SEPA touches on all aspects of an organisation’s business wherever there is a payee in a SEPA country, regardless of the purpose of the payment.
Seeing how this regional initiative has a global impact, the ability for organisations in the Americas and Asia Pacific to ignore or avoid SEPA readiness is fast disappearing. However, large corporates have been slow on the uptake for SEPA compliance, with just 28 percent in North America using SEPA credit transfers as part of their overall payment processes, compared to 75 percent in Western Europe.
While organisations outside of the 28-member SEPA zone may not yet have reached the necessary levels of commitment required to become SEPA compliant today, the pressure is starting to build.
“As the end date for compliance draws nearer, all eyes are on the 28-member states in the SEPA zone, along with the financial institutions and corporates within their borders," says Hugh Jones, Chief Executive Officer, Accuity. "But for organisations in the Americas and Asia Pacific, the question isn’t whether the SEPA mandate will matter, but when."
Jones adds that SEPA is not simply a mandate to be followed; it is an opportunity for companies across North America, Asia Pacific and elsewhere to reap a range of benefits, including improved payment processes and common standards.
Whether organisations outside the SEPA zone face the future today, tomorrow or down the road, the reasons for SEPA compliance become more compelling with each passing day.