Banking association calls on businesses and public sector to use SEPA products - SEPA infrastructure in place at beginning of 2008

18 July 2007 - The Single Euro Payments Area (SEPA) will be launched in January 2008. This means that from the beginning of next year there will be an integrated payments market for Europe’s single currency, the euro – not only for the whole of the European Union but also for the countries belonging to the European Free Trade Association (EFTA).

“In terms of its dimension and significance, this “revolution in European payments” is comparable only to the introduction of the euro,” stressed Hans-Joachim Massenberg, Deputy CEO of the Association of German Banks, when presenting the Association’s new booklet “SEPA 2008: Uniform Payment Instruments for Europe”. SEPA will give the EU’s 490 million citizens alone uniform schemes for their payment services – not only across borders but also, and above all, at domestic level.

At present, 60 billion payment transactions are handled every year in numerous different national schemes in 27 member states. Designed solely for payments within each country, these schemes are not connected. They are “insular solutions” that end at national borders. “SEPA will change this, because it will dismantle the borders that still exist,” Mr Massenberg added.

The preparations for SEPA are on schedule. “The private banks in Germany will make the new SEPA schemes available on time at the beginning of 2008,” Mr Massenberg said. SEPA was a major step forward for both the German and the European banking sector, which have agreed on the three common SEPA schemes for direct debits, card payments and credit transfers. Mr Massenberg drew particular attention to the role played by the banking sector in the launch of SEPA: “SEPA will show that voluntary action by banks leads to more efficient, more competitive and also more consumer-friendly solutions than market intervention by policy-makers.”

The SEPA payment schemes will be available from January 2008 in addition to today’s national schemes. Mr Massenberg underlined that the banking industry would not be able to operate both alongside each other on a permanent basis. A date would therefore have to be found as of which all euro transactions would be handled within the SEPA schemes. The national schemes would then be phased out.

“With SEPA, the European banking sector has prepared the way, but it cannot go this way on its own,” Mr Massenberg made clear. He called on businesses and the public sector to adopt the SEPA schemes for their payment transactions. Unfortunately, the public sector in particular had shown little interest so far in using SEPA products. However, not least for the sake of political credibility, it ought to set a good example and use SEPA products right from the start. “Only if SEPA is used and in this way becomes a reality can it fulfil the expectations that are rightly placed on it,” Mr Massenberg said.

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