Accounts payable automation specialist Digital Vision is alerting businesses to a resolution by the European Payments Council (EPC) which impacts any business making cross-border euro payments.
The resolution, which came into effect on January 1st is mandatory for all banks in the EU, and states that euro cross-border credit transfers must use IBAN and BIC* codes exclusively as the beneficiaryâs account identifier and bank routing designation. Banks receiving credit transfers using other identification, or incorrect codes, are fully entitled to reject or return them.
According to Digital Vision, failure to provide correct IBAN and BIC codes is likely to result in additional charges made by banks â estimated to be at least 50 euro per failed transaction, or higher as the charges are at each bankâs discretion â and at worst will mean payments are rejected, affecting business cash flow and credit control.
The company also points out that supplier bank IBAN and BIC codes can change without notice to businesses â potentially exposing them to additional charges or delayed payments without warning.
Bob Goodwin, director of Digital Vision said: âThis EPC resolution means that itâs vital for businesses to have the correct IBAN or BIC codes for all cross-border payments, to avoid delays or penalty charges. At the very least, businesses should check codes manually for accuracy before commencing payments. For companies that make many cross-border payments, this can be a significant issue, so there are directory services that can automatically validate codes before a payment is submitted, to stop errors of this kind. In any case, a simple validation check can save both internal and external processing costs.â