by Andrei Dutescu
As already known, as of 1 August 2014 (six months transitional period from 1 February 2014), bulk payments throughout Europe will have to be handled in accordance with the regulations for SEPA Credit Transfers and SEPA Direct Debits.
The Single Euro Payments Area (SEPA) refers to an economic area comprising well over 500 million citizens and some 20 million businesses and institutions. With SEPA, they are able now to pay all over extended Euro zone just as quickly, securely and conveniently as they do at national level .a either by a SEPA Credit Transfer or by a SEPA Direct Debit.
In the financial institution space SEPA schemas and ISO20022 are already known and widely implemented. But SEPA is not only about bank-to-bank transactions, corporates also have to comply. In fact looking back to the starting point of the SEPA initiative in 2004, SEPA was referring to the entire life-cycle from ordering customer to beneficiary:
“An area where citizens, companies and others will be able to make and receive payments in euro, within Europe, whether between or within national boundaries under the same basic conditions, rights and obligations, regardless of their location.” - European Payments Council Roadmap.
Having these facts on the table, the race to reach SEPA compliance is on, yet many companies/corporates have barely begun, never mind having fully SEPA-compliant payments in place, for corporate-to-bank connectivity.
Migrating to SEPA brings many different challenges for a corporate. Supporting the right data formats is one. Corporates need to check whether their systems are capable of processing the necessary SEPA formats (cash management - CAMT and payments initiation - PAIN messages).
Taking this into consideration and also over a decade expertise in payment processing landscape, Allevo can assist reaching the SEPA deadline, no matter if you are a corporate or a bank.
Allevo offer for SEPA compliance comprises the SEPAReady application for financial transaction processing and business & technical expertise. Looking only at the SEPA corporate-to-bank space, the application feature C2B ensures the processing of EUR payment initiation instructions compliant with SEPA rules and schemes, in the corporate-to-bank environment.
From solution’s point of view, C2B feature addresses separately the corporate-to-bank environment, offering 2 distinct applications: 1) for Corporates 2) for Banks.
1) C2B feature for Corporates ensures the processing of EUR payment initiation instructions for corporates, corresponding to the business flows in relation with their bank, in compliance with SEPA regulation and schemes.
C2B feature allows corporates to generate payments SEPA compliant. Payments will be delivered to the bank / Payment Service Providers (PSP’s) in the SEPA ISO20022 format (payment initiation messages – PAIN), enabling an easy interface of the corporate with the bank and offering advantages for both. Lower operating costs and simplified payments are just some of the advantages this solution provides for a corporate client.
Companies and institutions can use SEPA migration as an opportunity to optimize their cash and treasury management processes and structures.
2) C2B feature for Banks ensures the processing of Euro payment initiation instructions corresponding to the business flows in relation with their corporate clients.
C2B feature allows banks to receive SEPA compliant payment initiation requests from their corporate customers. The messages received are unpacked from the SEPA ISO20022 format in individual transactions and prepared to be processed by the bank’s Back Office applications.
From the bank’s point of view, C2B feature represents an easy way to implement a tool which ensures that the bank can receive SEPA compliant instructions from its corporate clients. C2B is increasing the efficiency of back office processes.
So far, good progress has been achieved with regard to creating SEPA awareness in the corporate sector, but for some companies, migration projects still must get under way and efforts must be intensified.
After 1 August 2014, there will be no further transitional period and everybody will have to use the SEPA standard, otherwise they risk refusal of transfers by payment service providers, who will have to refuse further processing of payments that are not delivered to them in the right technical format after the deadline applicable in the euro area.
Therefore, if you are a bank and you are SEPA compliant in relation with your correspondent banks or in relation with your CSM, but you cannot process SEPA instructions in relation with your corporate customers, there is a simple thing to do, just contact us and we will deliver exactly that component of our solution that you need, C2B Feature for Banks.
If you, as a bank, are fully SEPA compliant already (in relation with correspondent banks/CSM and your corporate clients), but some of your corporate clients are not ready for SEPA yet, you may help your customers by recommending our proven component C2B Feature for Corporates, which will help them become SEPA compliant in relation with their bank.
We are here to help you accommodate the market regulations and standards as fast and efficient as possible, so act now!
by Alina Enache
The business relationship between Allevo and SWIFT started in 1999 when Allevo became a SWIFT Registered Vendor and continued over the years, going deeper into certifying Allevo’s employees and applications, thus becoming SWIFTReady Services Partner (starting 2003). Allevo’s services portfolio has gained SWIFT appreciation due to the large area of business competencies covered by our business experts (SWIFT certified consultants for TARGET2, SEPA, Cash Reporting, Securities, TSU, Corporate and EUCLID), as well as by our implementation & support engineers (certified for all the products available in SWIFTAlliance suite). Moreover, qPayIntegrator v2.0 was the first SWIFTReady SEPA certified solution (in 2008 and 2009), and at the same time, the first Romanian banking solution designed for payment systems, which obtains SWIFT’s recognition for its proven compliance with the banking industry standards. qPayIntegrator has also received the letter of conformity for successfully passing the technical and functional validation criteria within SWIFT's certification programme for Workers' Remmitances in 2010, renewed for SWIFTRemit 2.0 in 2012.
In 2009, Allevo has signed a SWIFT Agency Agreement covering the promotion of SWIFT Alliance suite and other SWIFT business solutions, as well as the delivery of the related services in Romania. This already tight business relationship was further enhanced in 2013 when Allevo was selected as SWIFT Business Partner for Romania. In this new role, Allevo intermediates and promotes not only the interfaces and messaging solutions provided by SWIFT, but also the business solutions dedicated to the operational areas in the banks or corporates that are connected to SWIFT, covering the Romanian territory.
As a SWIFT Business Partner, Allevo’s team dedicated to coordinating on behalf of SWIFT the activities for Romania is planning a series of campaigns, adapting to the local trends and needs of the Romanian community SWIFT ’s global promotion of its solutions and informing about the updates, enhancements or newly-launched products and services. Please find below a schedule for approaching SWIFT’s Romanian customers, as well as institutions not yet connected to SWIFT, on the following topics:
· March 2014: BIC Directory (the SWIFTRef file that can be downloaded and used in any back-office/payments application for SWIFT messages validation and for updating the information about the banking correspondents) and Bankers World Online, an online platform giving access to all worldwide payments reference data available in the SWIFTRef utility (comprising financial information, correspondent banking data and contacts, credit risk ratings, all BIC codes from ISO-registry (200+ countries) from connected and non-connected financial institutions and corporates, all SEPA data, including IBAN/BIC validation and payments routing information, market infrastructures, etc).
· April 2014: Accord for Treasury, a solution enabling real-time matching and exception handling for foreign exchange, money market, OTC derivatives, and commodity trade confirmations. It is a cloud-based solution that avoids any upfront infrastructure investment that can be easily accessed and used to maximize operator efficiency whilst minimizing costs and operational risk in the treasury - back office departments.
· April 2014: SEPA Plus, a SWIFT reference data service providing the data needed to validate SEPA payment messages, as well as the information required for accurate and efficient routing (bank codes and their IBAN suitability to enable IBAN validation, SEPA specific BIC codes to enable completion of the BIC from the IBAN, SEPA routing information: Automated Clearing Houses membership and reachability, SEPA Credit Transfer and SEPA Direct Debit adherence to the SEPA schemes, etc).
· May 2014: SWIFT for Corporates – a solution that enables corporates to exchange financial information (payments, securities orders, reporting) with all their financial institutions through one highly secure, standardized communication platform, as opposed to multiple connections, consequently providing more visibility of cash, less cost to manage transactions and improved security and reliability.
· June 2014: Sanctions Screening – a cloud based solution hosted by SWIFT, that provides cost-effective screening of SWIFT messages in real time. SWIFT’s role at the heart of the international financial system enables transactions screening against multiple lists (managed and updated by SWIFT), allowing financial institutions to comply with sanctions laws, by blocking or flagging prohibited transactions in real-time. Being a cloud based solution, Sanctions Screening has no impact on the infrastructure and implies no software to install, making it less expensive than implementing an in-house system.
· June 2014: approaching non-banking institutions active in the financial industry – for those institutions that are interested in exchanging all types of SWIFT messages and file with financial institutions worldwide via a secure, reliable and standardized channel, SWIFT offers Alliance Lite 2, a cloud-based connection to the SWIFT network and related applications and services. With no infrastructure to maintain and minimal upfront investment (usage-based monthly fee), Alliance Lite 2 provides increased automation and straight-through processing of the financial flows.
Given Allevo’s expertise in SWIFT solutions and experience in providing SWIFT professional services, our team expresses its availability to assist the Romanian community of banks, other financial institutions, financial infrastructures and corporates in any SWIFT-related matter.