EPC Newsletter
Issue 5 - January 2010
Opinion and Editorial
Expectations are promising (and Patience is a Virtue)Results of the Second Annual Progress Report on the state of SEPA migration in 2009
28.01.10 BY Zuzana Kalivodova and Gerd Heinen
The Second Annual Progress Report was prepared by the Commission services, in close cooperation with the ECB, in the frame of the SEPA migration review process initiated by the Economic and Financial Affairs Council (ECOFIN) and provides an update on important SEPA-related developments in 2009. The ECOFIN Council welcomed this Progress Report at its meeting of 2 December 20091. The report provides a snapshot of the migration status of SEPA two years after its launch and identifies important developments for each SEPA payment instrument, highlighting especially the launch of the SEPA Direct Debit Schemes (SDD) in November 2009. Particular attention is paid to the migration of public administrations because of the crucial role they can play in achieving a critical mass of SEPA payments. Whilst the latest findings indicate that commitment to SEPA among public administrations is on the rise, the actual rate of migration to SCT in the public sector remained low during the reporting period. Zuzana Kalivodova and Gerd Heinen have the details.
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Positive developments
A crucial milestone has been achieved with the launch of the SDD Schemes on 2 November 2009. Previously, there was no scheme in place for direct debits in euro with cross-border reach. By 19 October 2009, over 2600 banks, representing around seventy per cent of SEPA payments volume, had signed-up for both the Core and the Business-to-Business SDD Schemes;
At this stage, most public administrations (PAs) still focus on planning for SEPA rather than actually driving migration. But commitment to SEPA in the public sector seems to be on the rise as is shown by an increasing number of PA migration end-dates, either defined at central government level or within individual PAs. PAs in four Member States (Belgium, France, Luxembourg and Slovenia) show strong commitment to SEPA by successfully coordinating migration in PAs and in that respect lead by example.
In the area of cards migration, progress has been observed on EMV implementation. In the second quarter of 2009, EMV compliance stood at 72 per cent for cards (up from 62 per cent shown in the last Progress Report), 77 per cent for POS (up from 68 per cent) and 93 per cent for ATMs (up from 83 per cent). However, the findings of the report emphasize the need for industry to urgently complete standardisation work in the cards area.
Room for improvement remains
The SCT migration rate is still very low. In August 2009, only 4.5 per cent of credit transfers were processed in SCT format2.
High-volume payment users such as PAs - even if strongly committed to SEPA - are slow in migrating to SEPA with only 1.5 per cent weighted SCT migration rate in September 20093 and therefore being significantly below the overall migration rate in euro area. There are however three Member States which beat the general average SCT migration trend by a large margin, namely Luxembourg, Slovenia and Belgium, with SCT rates of 100 per cent, 60 per cent and 18 per cent respectively. For PAs in the remaining Member States, the SCT migration rate is either below the average national SCT rate or even zero.
Zuzana Kalivodova serves as Seconded National Expert with the European Commission, DG Internal Market & Services. Gerd Heinen is Policy Officer at the European Commission, DG Internal Market & Services.
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1. http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ecofin/111670.pdf
2. http://www.ecb.int/paym/sepa/timeline/use/html/index.en.html
3. This rate decreased from 2.3 % shown in the second Commission services' survey on public administrations preparedness and migration to SEPA (status March 2009) to 1.5 % due to a statistical effect, namely that France provided an updated survey reply representing all of its PA transactions. Given that France has a very large number of PA transactions (852 million) and has not started to use SCT yet, this drove down the euro area average considerably by increasing the statistical base compared to the previous survey. It is therefore important to note that this should not be perceived as an actual decline of SEPA transactions in the euro area compared to the survey results published in July 2009.
Article91
Other articles in this issue
28.01.10 Update EPC Plenary Meetings - Main decisions taken in December 2009 By Gerard Hartsink 28.01.10 SEPA Scheme Change Management Cycle 2010 - Suggestions for changes must reach the EPC by end February 2010 By Herman Segers 28.01.10 The EPC Shortcut Series: continued - Three new EPC publications highlight key concepts of a SEPA for Cards By Meral Ruesing 28.01.10 PSD in Practice - Discrepancies in national transposition pose a challenge to banks By Ruth Wandhöfer 28.01.10 Clarity and Incentives needed - ECOFIN conclusions of December 2009 on setting an end date for migration to SEPA By Gerard Hartsink 28.01.10 Facing the Facts in January 2010 - The EPC Newsletter tracks the progress of SEPA implementation By Herman Segers 28.01.10 The Road Show - EC expected to harmonise rules for cross-border cash transport by road By Leonor Machado 28.01.10 Everybody loves E!*** - The role of the EPC in the creation of e-SEPA By Gerard Hartsink 28.01.10 Food for Thought - The EC Expert Group on e-Invoicing Final Report By Charles Bryant 28.01.10 The big Picture - Dematerialisation of business processes - in payments and beyond By Peter Potgieser 28.01.10 SEPA Survey 2009: Corporate Readiness on the Rise - The findings confirm that early movers have everything to gain By Eddy Ouwendijk and Joris Barbas 28.01.10 Nowhere to go but forward - How to create momentum for the SEPA programme By Javier Santamaría 28.01.10 SEPA to go - EPC White Paper on mobile payments: consultation is going on now By Dag-Inge Flatraaker 28.01.10 Optional SEPA Direct Debit Scheme in the Pipeline - Additional SDD Fixed Amount Scheme provides maximum planning security to consumers and billers By Javier Santamaría
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