The October 2013 edition of the Newsletter (see ‘related links’ below) takes another close look at the Single Euro Payments Area ( ) readiness of market participants three months ahead of the 1 February 2014 migration deadline applicable in the euro area mandated by European Union ( ) law.
In the article, entitled ‘ 2014: Clearing and Settlement Mechanisms are Ready to Turn up the Volume’, we report on the preparations of clearing and settlement mechanisms for the mass migration of euro credit transfers and direct debits to the -only environment. We also analyse progress among stakeholders including banks, corporates, small and medium-sized enterprises (SMEs) and public administrations in the 17 euro area countries. The most recent qualitative indicators published by the European Central Bank (ECB), which reflect the assessment by national central banks as of the third quarter of 2013, show that a large majority of stakeholders are expected to be -compliant on time. Further efforts are required however to ensure readiness, in particular, of all SMEs in the euro area by 1 February 2014.
On 24 October 2013 the ECB published its second migration report. It shows that migration to Credit Transfer is generally progressing swiftly. However, most stakeholders will only be migrating to Direct Debit in the last few months before the 1 February 2014 deadline. The ECB points out that this approach generates operational risks and limits the ability to tackle any issues or unexpected developments that might arise during the changeover period. In their article, Wiebe Ruttenberg and Gergely Kóczán of the ECB reiterate: “Everybody has to be ready on 1 February 2014 or risk disruptions in their individual handling of payment orders. After 1 February 2014 payment service providers will not be allowed to process payment orders that do not comply with the legal requirements as laid down in applicable law.”
With this edition, we also take the opportunity to address observations occasionally articulated in the public debate which indicate that misunderstandings persist as to who invented the concept and mandated migration to . Javier Santamaría, Chairman of the European Payments Council ( ), clarifies (again): it was not the .
is a policy-maker-driven integration initiative pursued by the governments and the institutions, i.e. the European Commission, the European Parliament, the Council of the representing Member States and the ECB. Santamaría revisits the rationale for as defined by the governments and institutions and their expectations on the benefits for payment service users to materialise once is completed.
Santamaría also points out: the proof of the pudding is in the eating. In a further article, he highlights the testimony of representatives of businesses and public entities, who reported on their successfully completed migration projects. These pioneers confirm: pays off.
If you would like to comment on this article, please identify yourself with your first and last name. Your name will appear next to your comment. Email addresses will not be published. Please note that by accessing or contributing to the discussion you agree to abide by the EPC website conditions of use.