The same research – the fifth annual State of the European Payments Marketplace survey – found that for a whopping 98% of the 420 participants from 47 countries other business challenges, such as mobile commerce (m-commerce), are a higher priority. Nonetheless, SEPA can’t be swept under the carpet. Ensuring your business is fully SEPA-compliant is an investment that can start paying immediate dividends for businesses that take the right approach.
SEPA is a payment integration initiative of the European Union (EU), which aims to simplify bank transfer transactions and improve business performance. It is essential that businesses ensure their systems are SEPA compliant, not only because of the imminent legislative deadline, but also to take advantage of the potential efficiency savings it provides that include:
- Simplified payment processes.
- Faster settlements.
- Improved cash flow.
- Potential reduction in costs.
Despite some popular misconceptions, SEPA is not just an IT or finance department issue. Failure to comply could be felt throughout an entire company, from customer service and support through to sales. If that scenario concerns you it’s a good indication that you can no longer afford to wait to migrate your existing system. Jonathan Williams, director of strategic development at information services group Experian, suggests that it can take several months for some organisations to fully migrate and understand the complexity of SEPA, as regards data validation and generating the formats required for SEPA payments.
The good news is that help is available to businesses, should they need it. However, a further finding from The Financial Services Club survey was that only a quarter of businesses within the eurozone have considered enlisting the support of external software providers. For Williams, this is a statistic which needs to change if businesses are to “optimise use of the time left and resources available to hit the (SEPA) deadline.”
Software providers specialise in providing robust and integrated finance systems that are not only SEPA compliant, but also provide businesses with significant efficiency and productivity savings. By automating manual and error-prone manual tasks these innovative solutions eliminate payment inaccuracies and speed-up management reporting, making migration to SEPA much more seamless.
A case in point is one of my company’s clients, Anthony Nicholas Group (ANG), a world leading manufacturer, wholesaler and retailer of heritage jewellery, which has improved operating efficiencies as a result of implementing integrated financial management and bank reconciliation software. In addition to enabling them to be ready for SEPA, ANG has saved 10 working days each month by replacing manual processes.
There is no financial or legal penalty for failing to migrate to SEPA. However, with EU regulation requiring that current payment systems be switched off before the deadline, those not using SEPA will risk being unable to make or collect payments, or face delays in transactions whilst enduring significant processing costs. Businesses that continue to overlook the benefits of SEPA-compliant business software may find that their out-of-date systems will be responsible for an unacceptable number of errors, resulting in delayed and rejected payments, costing companies up to €50 for each failed transaction.
SEPA should no longer be ‘the elephant in the room’. With just 20 weeks left to meet the deadline it should be viewed as an opportunity for businesses to avoid unnecessary costs, improve cash management and increase productivity, now more than ever.
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