SEPA Migration End Date survey reveals that banks see corporate customers as key to SEPA success

Brussels and Edinburgh - 14 May 2012

96% of 107 banks in 27 countries in Finextra | Clear2Pay survey embrace the end date for SEPA migration

On the opening day of EBA Day 2012, Clear2Pay, the international technology provider of next generation payment solutions for financial institutions, announces the results of a SEPA Migration End Date survey it executed in co-operation with Finextra. Survey respondents indicate that they believe that the competitive space for SEPA will be with their corporate customers – and that they (89%) need to offer those customers better solutions and services. 87% of respondents also call for an increased and better representation of corporates in SEPA governance.

Other key findings include:

Although banks concede corporate client payment services are key to the success of SEPA, 26% of banks are not yet ready to respond to incoming RFPs from corporate clients, whereas 75% of bankers concede that SEPA will negatively impact the number of banking relationships their customers hold and 74% fear competition from corporates connecting directly to clearing systems and thus reducing payment volumes with their banks.

It is not at all clear what the SEPA cost and revenue streams in a post-deadline market will be (77%).

For 52% of the respondent banks it is not clear how they will replace the revenues traditionally generated by Multilateral Interchange Fees

The existing infrastructure of many banks is not currently fit-for-purpose in a post-deadline market and SEPA is seen as a driver for centralisation of payment operations by 91% of the banks.

Many resources are needed between now and the migration deadline and in particular the knowledge of testing SEPA instruments is not widespread, 97% of respondents expect increased testing efforts, with a lower percentage being confident they can handle this with their own internal teams.

Ainsley Ward, Head of Management Consulting at Clear2Pay concludes: “This survey has confirmed a number of anecdotes, but has also thrown up a few interesting new ideas. It is clear that the focus in SEPA migration has, under the much desired pressure of the end date, moved from infrastructure readiness to a more customer-centric viewpoint. Banks are looking for ways to protect their volumes from risks that might arise by direct-connecting corporates or competitive banks that view SEPA as a relationship tool with their corporate clients and who actively pursue a growth strategy. Once the migration shake-down is behind us, those less adventurous banks will likely reconsider their future in the payments market.”

The survey ran during April 2012 and was completed by a diverse mix of 107 bankers across 27 countries. 71% of the respondents were based inside the eurozone, 60% of the respondents worked at senior management and board level, 25% is directly responsible for the implementation of SEPA. The survey looked at five areas of concern: Regulation and Governance, the Business case for SEPA, infrastructure readiness, Risks and competition and Strategic impact of SEPA migration.

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