IACT  Breakfast  Mee/ng  -­‐  28th  June  2013    

 Ireland’s  SEPA  readiness;  the  current  state  of  play  and  how  to  get  ready  

   Speakers:    

Michael  O'Neill.  SEPA  Programme  Manager,  IPSO      Barry  Manning,  Head  of  Cash  Management,  

Danske  Bank      Brendan  Sweeney,  Corporate  Sales  Manager  

Ireland,  Sentenial      

SEPA Presentation – I.A.C.T

Michael O’Neill

IPSO

SEPA Presentation June 2013

Why SEPA?

•  Trade growth not matched by development in payment systems;

•  Need for efficient pan-European retail payments market;

•  SEPA facilitates trade, fosters financial integration, completes monetary union;

•  SEPA is an important tool for strengthening EU competitiveness and growth.

•  SEPA = making cashless payments in EURO, across Europe, fast, safe and efficient

Timeline

1999 Euro as

accounting currency

2002 Euro coins

and banknotes

2008 Start of the Single Euro Payments

Area

2009 Payment Services Directive

2012 SEPA

Migration End Date

Regulation adopted

2014 1 February 2014, end

date

SEPA –In Ireland

•  Managed under the following headings

ü Awareness

ü Readiness

ü Migration

SEPA Awareness in Ireland

•  National Communications Campaign –  Press/Radio/Online

–  www.readyforsepa.ie

–  Leveraging business organisations

–  Bespoke presentations and publications

–  Technical workshops •  Individual bank communications:

–  Mail

–  Websites

–  Direct contact

–  Seminars

Key Features of SEPA

•  SEPA migration end date is 1 February 2014;

•  Existing national credit transfers (CT)

and direct debits (DD) will be replaced

from that date by pan-European

equivalents;(SDD & SCT)

•  Main direct changes: –  National sort code and account

number to BIC and IBAN; –  Standardised formats for making

payments; –  Different process for handling direct

debit mandates; –  Enhanced consumer rights for direct

debits.

SEPA Regulation

•  Payments Legislation Background –  Regulation 2560, Regulation 924 & Payment Services Directive

•  The SEPA Regulation 260/2012 –  One end date – 1 February 2014 –  BIC / IBAN Replaces NSC & Account Number –  New file formats ISO 20022 XML –  Reachability Provisions –  Enhanced Consumer Protection

•  Refunds, Black / White Lists, Limit Amount & Frequency, Refusal –  Payment Account Accessibility

Business SEPA check list

•  Do you submit electronic files to your bank? •  If no relax........If yes can you answer the following? •  Will your software supplier have a SEPA ready version in time?

–  If so by when? –  If not……………

•  Have your agreed a conversion timeframe with your bank? •  Who is converting your data (NSC and account numbers)? •  Do you need to cleanse your data? •  If you originate direct debits have you read the new scheme rule book?

–  Do you understand the implications for your processes and systems?

–  Have you agreed a testing timeframe with your bank?

SEPA - Risks and Issues

• Some clearing banks will not be in a position to complete SEPA service offering until Q3 2013;

• Many software providers struggling to be SEPA compliant in time for their customers;

• Bank conversion services for SCT becoming dominant in the Irish marketplace (as well as in many other countries);

• Mass late Migration • Migration to SEPA DD scheme for originators is a complex change;

• Based on current analysis, a challenge to ensure all stakeholders will meet deadline.

Conclusion

•  SEPA is not going away – No Plan B –  End date an EU Regulation

•  Consequences for missing end-date –  Fines and inability to make/receive payments

•  Awareness is rising –  But a long way to go on the detailed requirements

•  All clearing banks will be compliant by Q3 2013 –  Leaves a short window for migration for some

•  A significant effort required by businesses to be ready –  Not wholly engaged with Banks/Software providers yet

•  Limited change impact on consumers

–  But enhanced consumer rights with regard to Direct Debits. 159 Working Days to 1 February 2014.

Get Ready

•  Do not assume or presume that you will be SEPA ready without YOUR intervention.

Thank you

28th June 2013

Presentation to Irish Association of Corporate Treasurers Barry Manning – Head of Cash Management

SEPA - Single Euro Payments Area

14

SEPA By Numbers

Dates and Stats relevant to SEPA in Ireland

01/02/2014

41.8%

2.5%

22

14

31/10/2016

01/02/2016

SEPA Deadline

Sort Code 6 Account Number 8

% DDs Migrated

Removal of BIC

% CTS Migrated

IBAN Length

32

SEPA CTs and DDs Non Euro

SEPA Countries

15

Overall CT Readiness in Europe

Banks will start migrating more flows to SEPA over coming months Night-time Settlement key to this to maintain consistency ERP/Payroll Providers represent a key component which will drive migration

ECB SEPA Readiness Report

Statistics show a varying level of readiness

16

Surveys and Statistics Don't Lie

There is no plan B!

IBEC Survey April 2013

17

IRECC Payments to SEPA Payments

The similarities and differences between the 2 schemes

IRECC SEPA

TX Charge (Out) 0.19c 0.19c

Settlement (Out) D + 1 D + 1

Cut Off Times 3.30pm 3.30pm

TX Charge (In) 0.19c 0.19c

Settlement (In) D + 1 D + 1

Account Number Format BBAN IBAN

File Format IRECC STD 18 XML 20022

Bulk Debit Y Automatic Y File Indicator

18

Key Areas of Focus for CT Migration

These are the difficult tasks

• 3rd Parties •  IPSO • Danske Bank

Data Conversion

• Formats – Bank and IPSO • Conversion Services •  IPSO • Bank Test

XML

19

Scheme Differences

How the DD schemes differ from Scheme to Scheme

Features IRECC Scheme CORE Refund Right Authorised 8 Week for out of course

amounts ‘No Questions Asked’ Refund Right (8 week)

Refund Right Unauthorised

13 Months 13 Months

Submission Date 1st Payment

D-1 D-6

Submission Date Recurring D-1 D-3

Debtor Types Consumer and Business Consumer and Business

Mandate Approval in advance

No No

Migrate existing Mandates N/A Yes

B2B No Refund Period for

Authorised Transactions

13 Months

D-1

D-1

Business (Non Consumer as defined by PSD)

Yes

No

20

SEPA DD – Key Issues

Focus on these 6 areas

Creditor ID 1

Mandate Format 2

Timing Differences

3

Returns 4

Mandate Reference

5

Credit Booking Time

6

• New for SEPA • Issued through Bank

• New for SEPA • Bank approval required

• D + 5 – First (21.00) • D + 2 – Recurring (21.00)

• New return messages • New file format

• Unique for life of Mandate

• 14.00 on Due Date

21

What you need to do to be ready

The key elements of your SEPA migration

Prepare an Analysis

1

Contact software

vendors/Bank

2

Create a

Project Plan

3

Convert Data 4

Implement XML Format

5

• How do you collect /receive EURO payments • How do you make EURO payments • Bank integration/Formats/Bank Readiness

• Can they support XML formats/IBAN formats • Can data be exported/rei-mported for conversion • If not, then when?

• Who will convert data • What resources are available • Remember S/Os/Payment Templates/DDs

• Document what needs to be done, by when and by who • Involve and communicate with impacted staff • Include your Bank and Software providers

• Critical requirement • Remember testing and use dummy data • Formats available from Bank and IPSO

Brendan  Sweeney  Corporate  Sales  Manager  Ireland  

SEPA  Readiness  at  an  Advanced  Stage  

Sentenial  team  –  a8ending  today  

 Sentenial  Team  here  this  morning    •  Mark  Mooney,  Account  Manager  

•  Mélissa  Chouikrat-­‐Marcinkowski,  Pre-­‐Sales  Consultant    

   Please  drop  over!    

 

 

           

IACT  audience  this  morning  

 Different  perspec/ves  on  SEPA    •  Banks  

•  Corporates  

•  Professional  Services    

       

 

 

           

The  Sentenial  -­‐  Webinar  Series  Program  

     

March      SEPA  PreparaIons  in  Progress  

July        SEPA  Readiness  at  an  Advanced  Stage  

September  Nearly  There  for  SEPA  

SEPA  Readiness  at  an  advanced  stage  

AssumpIons  –  steps  you  have  already  taken  

Market  Readiness  Overview    

Case  Study  –  ‘Your  cash  flow  is  key’  

Consider  your  readiness  ‘On  boarding’  opIons  

Checklist  

AssumpIons  –  steps  you  have  already  taken  

Engaged  with  your  bank  –  ‘waiIng  to  hear  from  you’  

Reviewed  SEPA  requirements  /  impact  

Internal  systems  review  /  ‘impact  assessment’      

SEPA  project  established  

Project  plan  approved  /  Timelines  are  clear    

Your  Bank  

SEPA  Direct  Debit  

SEPA  Credit  Transfer  -­‐  Payroll  

SEPA  Credit  Transfer  -­‐  DomesIc      

SEPA  Credit  Transfer  –  SEPA  zone  

What  does  your  Bank  require  from  you    

When  ?  

IniIal  steps  not  undertaken  ?  

PercepIon  –  ‘The  Banks  will  look  aVer  it’  

AdopIng  a  ‘High  risk’  strategy  

Cash  CollecIon  –  is  ‘Business  CriIcal’  

SEPA  project  under  esImaIon  

Too  late  to  build      

Market  Readiness  Overview  

Sentenial  Market  Readiness      

A  wider  TransformaIon  change  project  

Sentenial  –  Our  Footprint  

Banking  Referral:    

White labelled Banking Partners:

Partners:

Industries

Timeline  for  Readiness  –  your  real  deadline?  

31st October 2013

1st February 2014

SEPA  –  A  wider  transformaIon  change  project  

More  than  File  formats  /  XML  

More  than  Mandate  Management  

Business  Channels  (Online,  Call  Centre,  outlets  etc)  

Start  at  iniIal  Customer  interacIon  points  (customer  data  capture)  

Impacts  across  business  teams  (billing,  reconciliaIon,  document  handling  etc)      

Case  Study  –  Irish  Company  

?  

cash  flow  

Business  streams  impacts  

Security    SEPA  provider  to  meet  their  

specific  requirements  

Customer  Touch  points  

Case  Study  –  Irish  Company  

   Sought  SEPA  provider  to  meet  their  specific  requirements  

 •  Business  is  OperaIng  in  Real  Time  •  A  need  for  a  fully  integrated  web  serviced  soluIon  •  Seamless  integraIon  with  Call  Centres  and  Online  Channel  •  A  hosted  soluIon  to  ensure  rapid  deployment  •  SoluIon  to  provide  mandate  management  services  •  SoluIon  that  generates  ISO20002  XML  file  format  

 

 

           

SoluIon  Overview  –    Mandate  Management  

Debtor  on-­‐line  sign-­‐up  

Call  centre  Staff  

   

ADD  MANDATE  Details  

KEY  NEW  MANDATE    Modify  Exis/ng  Mandate  

Details  

Add  /  Edit  /  View  /  Cancel  Mandates  via  WebService  

•   Validate  SEPA  Mandate  •   Validate  BBAN    •   Enrich  BBAN  to  BIC  /  IBAN  •   Generate  SEPA  Unique  Mandate  Reference  •   Store  Policy  Number  in  SEPA  Contract  field  •   Manage  Mandate  History  

Corporate  

SoluIon  Overview  -­‐  Direct  Debit  Management  

Debtor  on  line  sign-­‐up  

Call  centre  staff  

   

CREDITOR  BANK  

ADD  Policy  Details  

KEY  New  Policy  Details    View  /  Modify  Exis/ng  

Policy  Details  Query  Payment  History  

Schedule  /  Re-­‐Schedule  Collec/on  of  total    cost  in  Origix  using  Transac/on  Web  Service  

 Submit    PAIN.008  Files  Receive  PAIN.002  Files  

Corporate  

Enquiry  Web  Service  Send  Mandate  Reference    and  return  payment  history  

R-­‐Message  Web  Service        Inform  Corp  of  Failed  Payments  

Sentenial  –  Direct  Debit  Originator    On  Boarding  steps    

Requirement  for  Scheme  Number  to  be  in  place  first  (bank  applicaIon  required)  

 ApplicaIon  Pack  

 ImplementaIon  Steps  

Check  list  

   ü  SEPA  plan  in  place  ü  Confirm  with  your  bank  that  they  are  SEPA  ready  ü  Request  your  SEPA  Creditor  ID  from  your  Bank  ü  Timelines  are  clear  

 

 

 

           

Email:  salesireland@sentenial.com    

Thank  you!  

     

The  IACT  Debate  11th  September  2013  

 Topic:  “Austerity  has  done  its  work    -­‐  now  Ireland  needs  a  growth  budget”  

 Chaired  by:  David  McWilliams    with  a  panel  of  special  guests  

 Venue:  No  6,  Royal  College  of  Physicians,  

 Kildare  Street,  Dublin  2    

Time:  6:30pm  drinks  recepIon    followed  by  debate  at  7:00pm  

     

Upcoming  Events      

     

11th  October  2013  Annual  Dinner  

Venue:  The  Shelbourne  Hotel,  Stephen’s  Green,  Dublin  2  Time:  7:15pm  drinks  recepIon  followed  by  dinner  at  8:00pm  

Dress  Code:  Black  Tie        

20th  November  2013  Corporate  Treasury  &  Cash  Management  Conference    

Venue:  The  Gibson  Hotel,  02  Village,  Dublin  1    

TBA  November  2013  Evening  Presenta/on,  Cork  

Topic:  “2014  Economic  Outlook”  Time:  5:45pm  refreshments  followed  by    presentaIon  from  6:15pm    –  7:15pm:  

       

Upcoming  Events      

     

SEPA  CONTACTS  

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