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By Arthur Brieske, Global Head of Innovation and Commercialization & Americas Regional Head of Product Technology Management, Global Transaction Banking, Deutsche Bank, and Martin Runow, Head of Cash Management Corporates for the Americas, Global Transaction Banking, Deutsche Bank

On February 1, 2014, migration to the single euro payments area (SEPA) credit transfer (SCT) and SEPA direct debit (SDD) will become a reality. Rather than looking at this as an end-date, it should be viewed as the beginning of new and exciting centralization, automation and standardization opportunities for corporates. They will now have the opportunity to concentrate on the resulting benefits of SEPA compliance instead of focusing on looming deadlines and rising implementation costs.

The Benefits of SEPA

Arthur Brieske, Deutsche BankSEPA will enable corporates to move forward with a next-generation treasury/shared services platform. For example, the evolution of centralized payment factories can now be more readily complemented by centralized collection factories. Payments centralization will be much easier to achieve once SEPA is in place, because companies will be using exactly the same file format for payments across the SEPA zone and the fee structure will be the same—regardless of whether a payment is domestic or cross-border. With SEPA Direct Debits, for example, companies will no longer have to take account of the different processing times involved in clearing direct debits in individual European countries. A definite advantage of the SEPA file formats for payment/collection factories is that it includes an “on-behalf-of” field. Any corporate interested in further integration of treasury operations with shared-service centers (SSCs) should be taking advantage of SEPA.

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