Treasurers who do business in Europe must be aware that the deadline for compliance with Single Euro Payments Area (SEPA) regulations is fast approaching. What may be less obvious, however, is that the changes SEPA requires in a company’s handling of credit transfers and direct debits present an excellent opportunity to improve processes throughout the accounts receivable (A/R) function. Some Eurozone businesses that handle a large number of transactions are leveraging SEPA compliance activities to achieve big boosts in efficiency.
One company taking this approach is Carphone Warehouse, Europe’s largest mobile phone retailer, which has more than 2,000 stores and millions of mobile service subscribers. As part of its SEPA compliance activities, Carphone Warehouse has completely automated direct-debit management and streamlined much of the back-end processing of information going into and coming out of its core enterprise resource planning (ERP) systems. Treasury & Risk spoke with Kerry Lebel, senior director of product marketing for Automic, who helped the mobile phone retailer automate its payment-collection processes.
T&R: Are companies also improving their decision-making by consolidating data on direct debits?
KL: Yes, some companies are using this type of project to improve their liquidity management capabilities. For example, some retailers are better able to understand their payment collection processes once they consolidate sales and direct debit information. They are pulling together data on their cash flows and developing visual reporting for it. By automating these reports and pulling them together in real time—versus running reports at the end of the day, end of the week, or even end of the month in large batch transactions—they get insights into what is really happening with their cash flow. And having this information tied together centrally makes it significantly easier to throw these reports onto somebody’s desk on a daily basis.