SEPA: Last-Minute Stampede expected


It’s a bit like taking the train to the Frankfurt Book Fair: People squeeze into the carriages, even if it’s standing-room only. The date for the event was set months before. Everyone should have known that it’s better to reserve a seat. But, in the end, hundreds cram into the aisles – if they can get on the train at all. It’s similar with SEPA – which stands for single euro payments area – apart from the fact that SEPA will be compulsory for the European Union member states from February 1, 2014, there’s just one deadline, and it was announced long ago. Despite this, many companies haven’t started their SEPA project yet.

Of the 4.2 million creditor identifiers required in Germany alone, a mere 285,000 have been allocated. The creditor identifier comprises five letters and 13 digits, and is a key containing the country code, a check digit, the creditor business code, and the national identifier. Without this ID from a creditor, it will not be possible for a single euro to change hands within Europe (that is, the 27 E.U. member states, the four members of the EFTA, and Monaco) via direct debit from February 1, 2014.

“Most of them are in the evaluation phase” (Georg Fischer, SAP on the participants of the recent SEPA Day)

Georg Fischer is just one of the people who is concerned about this. He is responsible for SEPA at SAP and regularly offers SEPA events to provide information, give tips, and let the experts have their say. The reason for the current dilemma is the European Union – not because it initiated SEPA and set February 1, 2014 as the absolute deadline, but rather because software providers and also companies (as onlookers) had to get used to regular updates in the rulebooks, which are the specifications for the processes companies must follow and, in the end, the business software needs to map. “Since the first specifications came out in 2006, new versions of the rulebooks have been published regularly,” says Arndt Köster, an experienced product expert for financial accounting at SAP, who has been familiar with SEPA right from the start. This meant that not only the software providers but also the companies were given the impression every six months that they should wait until the final version appeared. That was also the belief that prevailed at the recent SEPA Day in St. Leon-Rot, near SAP’s German headquarters: According to details disclosed by the more than 300 participants, Fischer assumes that most of them are in the “evaluation phase” – in other words, they are still waiting and were pleased to hear that “the others aren’t any further than they are, either,” Fischer says.

Next page: The 5 steps to SEPA

But now it is clear: There will be no new rulebooks until November 2014. This means the various enablements that SAP usually makes available in the form of SAP Notes as well as support packages will not only remain valid but can be further optimized, without the fear of having to catch up with developments again tomorrow. “SAP Business Suite, Banking, SD, FI,” Köster says, “Everywhere SEPA processes play a role, we have prepared the software to cater to this.” There are currently 15 different solutions for SAP software, which are also listed on the Web site. “We cover all the key functionalities,” Köster explains.

The 5 steps to SEPA

Companies now have nine months left to get their projects started and completed. It is imperative that they heed the five steps below, as Georg Fischer and Arndt Köster know from experience:

  1. Set the right priorities when putting the team together: All stakeholders should be represented who will come into contact with SEPA processes later, from the business department, through sales, IT, and management.
  2. Analyze your systems: Which systems are affected? Apart from sales, financial accounting, and CRM, are there any other areas that need to be taken into account?
  3. Optimize the quality of your data: Every customer account needs to be switched to IBAN and BIC. If the master data is not correct, direct debits won’t be possible. It therefore makes sense to use the SEPA project to also improve the quality of your master data. This is particularly relevant for companies who work with a great many subscribers, such as publishing companies. For every newspaper and magazine subscriber, their IBAN/BIC must be available before their direct debit can be continued as normal.
  4. Clean up your processes: You need to run through the entire process from sales through payment. You must clearly specify the date for the SEPA mandate and the amount of advance notice.
  5. Implement applications step-by-step: It makes sense to implement the new solution step-by-step, with ramp-ups at the start in which you can test the new software’s functions and features using small customer groups. “Start by simply transferring a euro from one company to another and see whether everything is posted correctly,” Fischer advises. IT capacities must also be checked because the XML format generates data volumes that are three to five times bigger.

Of course, you need to apply for the creditor identifier right at the start. “We recommend that you do this now,” Fischer says, because the German Central Bank is evidently already preparing itself for a substantial number of last-minute applications at the end of this year and the beginning of next year. However, there are no guarantees. At the end of the day, it’s like on our packed train to the Book Fair: If you can squeeze in, you’ll get there.

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