The European Payments Council ( ) adapts its structure to further enhance governance and stakeholder involvement
With migration to harmonised Single Euro Payments Area ( ) payment schemes in the euro area complete1, the resolved in October 2014 to adapt its current structure to further enhance governance and stakeholder involvement. The primary objective of this process is to ensure that the continues to be best equipped to perform its main task, i.e. to manage the Credit Transfer ( ) and Direct Debit ( ) Schemes, in an efficient and transparent manner. With this objective in mind, the will create several new bodies responsible for managing the administration and evolution of the and Schemes. The carries out the scheme management function subject to legal and regulatory conditions defined by the European Union ( ) authorities.
The remains committed to contributing to safe, reliable, efficient, convenient, economically balanced and sustainable payments, which meet the needs of payment service users and support the goals of competitiveness and innovation in an integrated European economy. Considering that the authorities driving the process have clarified that migration to harmonised payment schemes does not conclude this integration project, the adjusted structure will also facilitate developing positions on behalf of members, representing payment service providers ( ), vis-à-vis the institutions, public authorities, international organisations, and the general public on European payment issues as well as on policies, legislation and regulations impacting payments.
The new governance model will become operational in the first quarter of 2015 once the revised Charter takes effect subject to procedures to be observed under Belgian law and the new Scheme Management Internal Rules come into force.
For detailed information, refer to the article, entitled ‘European Payments Council 2.0: with Migration (Euro Area) Complete, the Adapts its Structure to Further Enhance Governance and Stakeholder Involvement. The new governance model will become operational in the first quarter of 2015’ in this edition of the Newsletter (see ‘related articles in this issue’ below).
The approved modifications to the next generations and rulebooks
The evolution of the and Schemes, as set out in the and Rulebooks, reflects changes in market needs and updates of technical standards developed by international standards bodies, such as the International Organization for Standardization (ISO). Since the launch of the Scheme in 2008 and the Schemes in 2009, the has generally published updated versions of the rulebooks and associated implementation guidelines once annually. (For more information on the scheme change management process, refer also to the Website page, entitled ‘ / Rulebook Release Management and Scheme Development’ included in the ‘related links’ below.)
The approved modifications to be included with the next generations and Rulebooks. The will publish the Rulebook version 8.0, Rulebook version 8.0 and Business to Business (B2B) Rulebook version 6.0 and associated implementation guidelines in November 2014. These rulebook versions will then take effect in November 2015.
For detailed information on the modifications to the next generations and Rulebooks, refer to the article, entitled ‘ and Rulebooks: Modifications to the Rulebooks to Take Effect in November 2015 and November 2016, Respectively. Based on feedback received during the 2014 public consultation on changes to the rulebooks, the resolved to update the release schedule applicable to the next rulebooks generations’ in this edition of the Newsletter (see ‘related articles in this issue’ below).
Approval of manual on best practices in automated teller machine (ATM) cash replenishment in Europe. The manual is the result of a multi-stakeholder project involving the ATM Industry Association (ATMIA), the European Intelligent Cash Protection Association (EURIPCA) and the
The approved the manual ‘Best Practices in ATM Cash Replenishment in Europe’ which has been published by the ATM Industry Association (ATMIA) and the . The manual endeavours to:
- Highlight that professionals in the cash value chain hold a shared responsibility to continuously review processes and methods in order to ensure this payment method is provided in a cost effective manner, delivering the service to the level of quality expected by consumers.
- Produce a comprehensive and ‘best-of-breed’ overview of best practice in terms of how to manage cash through its main distribution channel, the ATM.
- Evaluate the pros and cons of various replenishment models with a view to identifying best practice.
The manual is the result of a multi-stakeholder project involving ATMIA, EURIPCA and the . The overall goal is to enhance and reduce the costs of the ATM replenishment process and staff training.
For detailed information, refer to the article, entitled ‘ATMIA and Publish a Manual on Best Practices in ATM Cash Replenishment in Europe. Creating a more efficient and less costly cash handling process’ in this edition of the Newsletter (see ‘related articles in this issue’ below).
The approved publication of the document ‘Guidance for Direct Debit Business to Business ( ) Scheme Mandate Confirmations’
The approved the document ‘Guidance for Direct Debit Business to Business ( ) Scheme Mandate Confirmations’, which was subsequently published on the Website (see ‘related links’ below). This document addresses the mandate confirmation requirements and operational implementation thereof prescribed in the Rulebook. The guidance aims to support scheme participants, i.e. that have formally adhered to the schemes, to comply with the mandate confirmation requirements defined in the Rulebook.
The Scheme enables business customers in the role of debtors (payers) to make payments by direct debit. Services and products based on the Scheme are only available to businesses; the debtor must not be a private individual (consumer). In the Scheme the debtor (a business) is not entitled to obtain a refund of an authorised transaction.
The Scheme requires the debtor bank, (the bank of the payer), to ensure that the collection is authorised by checking the collection against mandate information. A mandate is signed by the debtor to authorise the creditor to collect a payment and to instruct the debtor’s bank to pay those collections. The debtor bank and the debtor are required to agree on the verification to be performed for each collection.
This means: the debtor bank must check whether or not a valid mandate is in place prior to executing an collection. The debtor bank has to obtain confirmation from the debtor on the mandate data received as part of the first collection prior to debiting the debtor’s account.
The guidance document also reiterates that each mandate is identifiable based on the ‘unique mandate reference’. This mandate reference is assigned by the creditor (biller). It is recommended that the creditor indeed assigns unique, i.e. distinct, mandate references to separate mandates signed by the same debtor to authorise collections under the and the Schemes, respectively. The risk of not following such practice is that debtors who wish to block a collection by providing the unique mandate reference will block all other direct debits having the same mandate reference.
Last but not least, the document identifies mandate confirmation practices that are outside the scope of the Scheme.
Observing the principles reiterated with this guidance document should contribute to reducing the occurrence of R-transactions under the Scheme triggered in the event that the debtor bank does not obtain the required mandate confirmation from the debtor. (Possible exceptions to the normal execution of a direct debit collection include, for example, returns, rejects, refusals and reversals, commonly referenced as ‘R-transactions’ and described in detail in the Rulebooks.)
Javier Santamaría is the Chair of the .
Related articles in this issue:
European Payments Council 2.0: with SEPA Migration (Euro Area) Complete, the EPC Adapts its Structure to Further Enhance Governance and Stakeholder Involvement. The new EPC governance model will become operational in the first quarter of 2015
SCT and SDD Rulebooks: Modifications to the Rulebooks to Take Effect in November 2015 and November 2016, Respectively. Based on feedback received during the 2014 public consultation on changes to the rulebooks, the EPC resolved to update the release schedule applicable to the next rulebooks generations
Related articles in previous issues:
1 In February 2012, the European Union ( ) co-legislators, i.e. the European Parliament and the Council of the representing governments, adopted the ‘Regulation ( ) No 260/2012 establishing technical and business requirements for credit transfers and direct debits in euro’. It defines 1 February 2014 as the deadline in the euro area for compliance with the core provisions of this Regulation. In non-euro countries, the deadline will be 31 October 2016. Effectively, this means that as of these dates, existing national euro credit transfer and direct debit schemes will be replaced by Credit Transfer and Direct Debit. To avoid difficulties for non-compliant market participants, in February 2014, the European Commission, the European Parliament and governments agreed to “give an extra transition period of six months” during which payments which differed from the format could still be accepted in the euro area after 1 February 2014. It is important to keep in mind that, following 1 August 2014, countries in- and outside of the euro area ensure that they are ready to meet compliance requirements applicable in 2016 mandated by law. The Regulation has introduced several possible exemptions regarding the use of the International Bank Account Number (IBAN), the Business Identifier Code (BIC) and the ISO 20022 XML message standards by the February 2014 deadline. Member States have discretion as to whether they will use any or all of the options to derogate from the 1 February 2014 deadline (until 1 February 2016) with regard to the use of the IBAN, the BIC and the ISO 20022 XML message standards by payment service users. Niche products, which have been granted an exemption: the Regulation, in particular, stipulates that credit transfer and direct debit transactions with a cumulative market share of less than 10 percent in an Member State must comply with the provisions set out in this legislative act only by 1 February 2016. Non-euro countries will have to comply with the Regulation by 31 October 2016. For more information, refer to the Blog, entitled ‘1 August 2014 Does Not Mark the End of the Migration Process. Get Ready for 2016. Act Now.’ http://www.europeanpaymentscouncil.eu/index.cfm/blog/1-august-2014-does-not-mark-the-end-of-the-migration-process-get-ready-for-sepa-2016-act-now/.
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