The advent of SEPA allows companies to operate more efficiently, providing low-cost, reliable and efficient payment services across Europe, said Carole Schwarz, director, international cash management sales at Royal Bank of Scotland (RBS), opening a session on the closing day of the Association for Financial Professionals’ (AFP) annual conference in Washington DC.
Prologis, which operates and develops industrial real estate, is one of the companies that opted to adopt SEPA early on and is enjoying the advantages. The company has US$50.2bn in assets under management across four continents and 21 countries, while in Europe it’s property portfolio, valued at US$13bn is spread across 14 countries.
Regina Ocher, Prologis’ vice president, said that the company started preparing for SEPA back in 2011, initially regarding it as a compliance exercise. By early 2012, it had become evident that SEPA would also impact positively on its daily operations by reducing payment backlogs, reducing the number of rejected payments and also the number of service requests directed to its bank and would increase the efficiency of day to day operations.
By mid-2012, SEPA implementation had become a strategic project incorporated into the company’s upgrading of its enterprise resource planning (ERP) and cash management system. Prologis’ was fully SEPA-compliant by early 2013; more than a year ahead of schedule.
As a result, the company’s payments backlog has been eliminated, as have cross border payment costs on SEPA payments, while banking fees have been reduced. Additionally, Prologis has implemented several SEPA-related process improvements, such as:
- Expanding the volume of payments and collections on behalf.
- Increasing the number of direct debits.
- Relocating many of the new accounts to the Netherlands, to achieve cost savings.
- Evaluating eXtensible markup language (XML) reporting capabilities and the impact of Prologis’ reconciliation practices.
In addition, the company is also evaluating a possible transition to XML reporting and a number of other strategic projects, which include virtual accounts, expanded payments on behalf, electronic banking and further expanding the use of direct debits.
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