TietoEnator Achieves Sepa Credit Transfer Successes

Press release
22 September 2008

TietoEnator, one of the largest IT services providers in Europe, announces that SEPA Credit Transfer Solutions (SEPA Bulker) have been implemented for three of the largest Nordic Banks, Swedbank, Handelsbanken and Nordea, as well as for two Danish bureaus, BEC and SDC.

The Nordic banks have implemented TietoEnator’s SEPA Credit Transfer solution, group-wide enabling offices in different countries to connect to one single infrastructure. The Swedish Swedbank also supports its many local saving banks with SEPA Payment services.
The TietoEnator solution has enabled the banks to seamlessly connect to the EBA STEP2 SCT Service, as well as take full control for the bulking / debulking of all inward and outward SEPA payments, perform reconciliation and monitoring, as well as generate accounting entries.

This same SEPA Credit Transfer solution was also implemented for two Danish service bureaus, BEC and SDC, serving several hundred financial institutions with banking services, including payments and SEPA. BEC has more than 40 banking customers on SEPA Credit Transfers; with SDC serving more than 70. In addition to this, TietoEnator has delivered a recent upgrade to the SEPA solution, allowing the customers of these service bureaus to connect as indirect SEPA SCT participants to larger banks who are direct participants.

TietoEnator’s other successes in the SEPA area include a substantial upgrade to its Payments Engine, which is now fully SEPA Credit Transfer compliant. Customers such as Royal
Bank of Scotland, DnB NOR and 15 banks at Norwegian Service Bureau EDB are now fully operational with the upgraded payment engine solution. In addition to the SEPA Credit Transfer solution, TietoEnator has also services for corporate to bank (C2B) connections.

Commenting on TietoEnator’s progress in SEPA Credit Transfer solutions, Dagfinn Loen, Sales Director Payment Solution, said, “We are delighted about our great success with our SEPA Credit Transfer offerings. It illustrates TietoEnator’s commitment to proactively invest and support new market initiatives in the payments area and to continue to be a leading provider of payment solutions to the market. In the SEPA area, our investments continue with SEPA Direct Debits and we are optimistic about continuing our success in this area too”.

SEPA Migration Fails to Satisfy Sibos Delegates

Press Release

A survey by ACI Worldwide at this year’s Sibos has found that 78 percent of those delegates questioned who expressed an opinion ‘strongly agree’ or ‘agree’ that the migration to SEPA instruments has been disappointing to date. Moreover, 46 percent of respondents feel there is nothing more that the banking industry’s self regulation of SEPA can deliver and they overwhelmingly believe that the time is right for SWIFT to play a role in reversing the present situation.
The key findings from the survey include:
• 78 percent of respondents who expressed an opinion believe that the migration to SEPA instruments has been disappointing to date
• 75 percent of respondents believe that there is now a role for SWIFT to play in extending bank-to-bank collaboration to provide the SEPA business solutions required by the market
• 77 percent of respondents believe that if SWIFT allows greater access to its network for corporates, it can assist in the take-up of SEPA and the adoption of end-to-end standards

Paul Styles, business solutions manager at ACI Worldwide, commented on the findings, “SEPA started as a framework to benefit corporates and consumers but has morphed into an interbank framework that has been moulded primarily by the banks. It’s not surprising therefore that SEPA migration has been considered disappointing to date. However, we agree with the majority of Sibos delegates that as an ‘external’ body, SWIFT could help to make SEPA a more attractive proposition for corporates. SWIFT could have an important role to play in helping the banking industry formulate a business case for corporates’ SEPA migration. Such an approach would also help avoid the ‘mini-SEPA’ dreaded by the regulators, where significant regional or country-specific variations exist.”

The survey targeted 104 Sibos 2008 delegates, representing financial institutions, corporates and vendors.

STEP2 SCT to offer night-time settlement from December 2008

Press release by EBA CLEARING Published September 16, 2008

EBA CLEARING starts testing of STEP2 SCT settlement in TARGET2 on multilateral net basis EBA CLEARING announced today its PE-ACH platform STEP2 will be the first Clearing and Settlement Mechanism to offer its users night-time settlement of SEPA payments in TARGET2. TARGET2 acceptance testing of the new settlement model starts on 24th September 2008. Participants in the STEP2 SEPA Credit Transfer (SCT) Service will be able to take advantage of the optional night-time processing and settlement cycle from 8th December 2008 on. The new cycle is open for sending from 13:00 CET on D-1 to 01:00 on D with settlement taking place at 01:30 and output file delivery starting at 02:00. “With the implementation of a night-time cycle for the STEP2 SEPA Services, we respond to our users’ requirement for STEP2 file delivery in the early hours of the morning,” said José Beltrán, Director of STEP2 Services at EBA CLEARING. “The new cycle facilitates early application of funds to customer accounts and, at the same time, ensures that the secure principle of settlement before delivery of files is maintained.” The introduction of a night-time processing cycle with settlement in TARGET2 has been made possible by the implementation of a new Multilateral Netting Module (MNM), which will serve as an interface between the STEP2 platform and the TARGET2 Ancillary System Interface (ASI). The MNM was developed by EBA CLEARING in co-operation with SWIFT in order to facilitate the exchange of SEPA Credit Transfer – and later also SEPA Direct Debit – settlement transactions between the two systems and to derive net settlement amounts from the individual bilateral gross obligations generated by the STEP2 platform. The new settlement model in TARGET2 will also be applied to the morning and afternoon cycles currently in place for the STEP2 SCT Service. While the two day-time cycles will settle through ASI4, the settlement of the night-time cycle will take place via ASI6. By offering settlement of its STEP2 SEPA Services in TARGET2 on a multilateral net basis, EBA CLEARING prepares its Pan-European ACH for the growing volumes to be processed via the SEPA instruments by a larger user base in the upcoming years. The new settlement solution provides greater efficiency of liquidity and more flexibility to existing users as well as open access to the wider community of institutions wishing to be connected to the STEP2 SEPA Services. Besides responding to key business requirements of the STEP2 SCT Participants, the new enhancements will also ensure that STEP2 SCT will comply ahead of the time with the major additional requirements of version 3.2 of the SCT Scheme Rulebook, which will become applicable on 2nd February 2009.

Survey reveals PSD paradox

From banking technology.

Nearly 80 per cent of respondents to a joint Sibos Daily News and BT survey believe the Payment Services Directive (PSD) is a major change for their institutions. Despite this, only just over half (53 per cent) have read the PSD document. "It is frustrating that only half of the respondents have read the PSD document, when it has been in circulation for nine months, and the PSD comes into force in November next year," said Chris Pickles, head of marketing, investment banking and global accounts, BT Global Services. "I don't understand why respondents would identify the PSD as a major change for their institution but have not yet bothered to read the document."

When asked on which initiative they were spending more time - the single euro payments area (Sepa) or the PSD, 79.4 per cent of respondents said Sepa. Again, Pickles said this revealed a paradox: "Sepa is still getting the majority of attention, but the respondents feel the PSD will represent a major change. Sepa is a banking initiative and has no legal standing. There are no mandated deadlines for Sepa, unlike the PSD."

Since the introduction of Sepa credit transfers in January this year, the banking industry has been told Sepa will add value to their business. At the launch, the European Commission (EC) stated that Sepa would provide banks with opportunities to "develop innovative products, enter new markets and win new customers as well as increase the efficiency of back office processes". When asked whether Sepa would enable their organisations to add value to payments or transaction services businesses, 53.6 per cent of our survey respondents said yes, but 46.4 per cent said no. "Most banks have not made clear why Sepa represents added value," said Pickles.

Sixty-one per cent of respondents view the PSD as a compliance problem, rather than a business opportunity. Pickles draws parallels here with another EC initiative, the Markets in Financial Instruments Directive (Mifid). "The attitude towards Mifid at the start was very much that it was a compliance problem, but it has proved to be a business opportunity for a number of players. The multilateral trading facilities created by Mifid, such as Turquoise and Chi-x are challenging the incumbent exchanges. The same may well happen with the payment institutions that will be created under the PSD. Payment institutions should open up competition in the payments space because the existing competition is not adequate today."

Source: Euro Banking Association, 15 September 2008

EBA publishes Payment Services Directive guide

The Euro Banking Association (EBA) announced today the publication of a high-level overview paper entitled Banks Preparing for PSD: A Guide for Bankers on the Payment Services Directive.

The document has been compiled by the EBA's Working Group on SEPA and PSD Compliance in order to provide banks with a basic overview of the Payment Services Directive (2007/64/EC).

"The overall aim of Banks Preparing for PSD is to outline in simple language and with the support of explanatory illustrations, overview tables and take-away recommendations the complex issues that banks need to carefully study and address in order to achieve PSD compliance," said Björn Flismark of SEB, Chair of the EBA Working Group on SEPA and PSD Compliance.

Besides providing a short introduction to the context, purpose, benefits and scope of the Directive, the EBA guide goes into more detail on a number of key provisions from a bank's perspective.

Among others, the document takes a closer look at PSD requirements relating to execution time, value dating, availability of funds, charges and cash deposits as well as at information and transparency requirements. It also focuses on customer obligations and liabilities with a special focus being placed on claim and refund periods stipulated by the PSD.

Furthermore, the EBA guide gives a general overview of the areas within the banks that will be impacted by the PSD at a practical, strategic and tactical level. The paper concludes by addressing some of the frequently mentioned myths concerning the PSD.

Banks Preparing for PSD can be downloaded as a PDF document from the EBA website at abe-eba.eu. Paper copies are available at the stand of the EBA at SIBOS (C303) or may be requested via e-mail (association@abe-eba.eu).

SAP Gains Deutsche Postbank as Bank Software Client

From Bloomberg.net - By Andreas Hippin

Sept. 15 (Bloomberg) -- SAP AG, the world's largest maker of business-management software, said Deutsche Postbank AG started using its software to process payments.

Betriebs-Center fuer Banken AG, a unit of Germany's biggest consumer bank by clients, is using the system it developed with SAP to handle high transaction volumes, SAP said in an e-mailed statement today. Financial terms of the deal were not disclosed.

Postbank is the first customer to introduce SAP's core banking systems. The Walldorf, Germany-based software company aims to increase sales to the banking industry as lenders introduce standardized information technology to boost efficiency and cut costs. In a separate statement today, SAP said it won HSBC Holdings Plc as a new customer for software to automate corporate client services.

``Our growth as an insourcer of back-office services in Europe now has no technical limitations,'' Mario Daberkow, a management board member of Deutsche Postbank, said in the statement. ``The payment engine has been developed to quickly implement future SEPA formats.''

Deutsche Postbank's BCB unit is the country's largest payment transaction company, servicing four out of Germany's five biggest banks, according to the statement. BCB sees the opportunity to expand its client base as European banks prepare to meet standards for the so-called Single European Payment Area, or SEPA.

Daberkow said by 2010 a ``significant volume'' of European payment transactions will be executed following the SEPA standard.

Earlier this month, SAP won a contract to provide Banco Sabadell SA with human resources products. On June 26, SAP said it won Commerzbank AG, Germany's second-biggest lender, as a customer for its bank product.

PAYplus ServiceBureau introduced by Fundtech

Sep 12, 2008 (TELECOMWORLDWIRE via COMTEX)

Fundtech Ltd (Nasdaq:FNDT), a developer of banking transaction solutions, has announced the introduction of PAYplus ServiceBureau, the first SWIFTReady global payments platform combined with SWIFT services, available as an outsourced service. The company said that PAYplus ServiceBureau, available as Software as a Service (SaaS), enables banks to upgrade their payments platform without large up-front investments in a new system, as well as relieving them of the ongoing support costs of maintaining and extending it.

The new service reportedly supports payment processing for major European payment networks, including SWIFT, EBA, TARGET2, SEPA and a range of domestic clearing and settlement systems in Europe and Asia-Pacific. The solution offers banks a low-cost option for adding SEPA payments, including Direct Debits and the conversion into ledger format.

PAYplus ServiceBureau provides the full range of SWIFT messaging, including FIN, FileAct, Interact and Browse, transaction filtering for PEP (Politically Exposed Persons), OFAC and other watch lists, as well as message archiving and reconciliation, the company said.

The system, scheduled to be available in Q1 2009, will be deployed in the service bureau operated by BBP, Fundtech's subsidiary located in Switzerland. After an integration fee, banks will pay a monthly fee combined with a per-transaction charge.

No other pricing details were disclosed.

VocaLink Survey Finds Over One Third of Companies Have No Experience of SEPA

Distributed by PR Newswire on behalf of VocaLink

LONDON, September 11 /PRNewswire/ -- VocaLink, the payment transaction specialist, today published research showing that eight months after the introduction of the Single Euro Payment Area (SEPA) more than three out of ten businesses have had no experience of it.

SEPA came into effect in January 2008 and SEPA Credit Transfers have been processed since the first day. Yet the survey of corporate treasurers commissioned by VocaLink found that 35% have had no experience of SEPA. The next stage in the evolution of SEPA is the introduction of SEPA direct debit (SDD) but the survey also shows that 36% of corporate treasurers do not expect to implement SDD until 2011 or later. Only 28% of respondents expect to use SDD by the end of 2009.

Paul Taylor, managing director for Europe at VocaLink, comments: "Our research shows that there is a huge opportunity for banks who take an early lead in the market, especially for SEPA direct debit (SDD) services. The trick is to make it attractive to those customers. Working with banks in this space, VocaLink has developed a range of value-added services, such as payments capture and mandate management, to enable banks to make SDD attractive to their clients. Deploying these services offers banks a great opportunity to provide competitive SDD-enabled services to corporate customers ahead of the market and to win new market share."

Other findings of the research reveal that corporate treasurers want more real-time payment information, which in turn leads to more comprehensive reporting and reconciliation, and consider a single bank relationship as being most beneficial for their business. Paul Taylor adds: "Addressing real time requirements from clients is an ever-increasing issue for the banks that we work with. In response to this market demand, we have developed the VocaLink Real-Time Payments Platform on behalf of major banks around the world and offer services which meet the needs of banks' corporate customers."

The survey 'Meeting the transaction needs of corporates' was conducted in June 2008 by gtnews.com and commissioned by VocaLink. 77% of the respondents are in executive or management positions, and the largest response came from corporates with revenues over $1bn. VocaLink is using the findings of the research to continue to provide its clients with services that support corporate customers' specific needs.

Notes to Editors

About VocaLink

VocaLink is a specialist provider of transaction services to banks, their corporate customers and Government departments. It processes domestic and international automated payments and provides ATM switching solutions. On a peak day, the VocaLink automated payment platform processes over 90 million transactions and over half a billion in a month. Its switching platform connects the world's busiest ATM network of over 60,000 ATMs. Its Real-Time Payments platform provides the central infrastructure for the UK Faster Payments service. VocaLink is working with BGC to provide outsourced processing for the majority of Sweden's domestic payments.

Having pioneered electronic payments for over four decades, many of the world's top banks and their corporate customers rely on VocaLink to meet their transaction needs. Its processing services offer banks reach throughout the Single Euro Payments Area (SEPA) and beyond; and are complemented by value-added services that leverage industry expertise and technical capabilities.

Please visit http://www.vocalink.com for more information

About gtnews

24 hours a day, 365 days of the year, gtnews provides treasury professionals around the world with an unparalleled information resource and forum.

gtnews is the foremost resource for information relating to the treasury profession. The gtnews.com website contains over 4,000 articles, special reports, guides, surveys, webinars and video interviews, which increases by more than 50 new items each month.

Readers are alerted every week of the news through the gtnewsletter, which all 53,000+ registered readers receive.

The 53,000+ readership of gtnews constitutes the largest and most comprehensive active network of treasury professionals around the world. The geographic reach encompasses North America, Latin America, Europe, the Middle East and Africa, and they are drawn from a diverse mix of corporations, banks, central banks, and monetary authorities, financial institutions, consultancies, government departments and academic institutions, as well as information and financial technology providers.

The gtnews editorial strategy is driven by a thorough understanding of the needs and interests of treasury professionals, and its contribution based format elicits a high level of content submission from the experienced treasury subscriber base.

   
   For further information please contact:

   Gerald Cross at the JJ Group
   +44(0)1865-343100 or vocalink@thejjgroup.com

   Kevin Monks at VocaLink
   +44(0)870-920-8574 or kevin.monks@vocalink.com

   Deborah Souter at VocaLink
   +44(0)870-920-8651 or deborah.souter@vocalink.com

VocaLink - Equens Interoperability Agreement Extends Network for SEPA Payments

My personal achievement...

***********************

UTRECHT, Netherlands and LONDON, September 9 /PRNewswire/ -- VocaLink and Equens, have implemented a bilateral link for the exchange of SEPA payments. This is a major step in the implementation of the EACHA(1) framework announced in October 2007 to help establish interoperability between banks and European CSMs(2). The arrangement supports both companies' SEPA offering while helping to create a more competitive market by allowing banks to choose the payments processor or processors that best meet their needs.

Martin Wilson, Chief Commercial Officer at VocaLink, commented, "This launch with Equens illustrates our commitment to the EACHA framework and to providing our customers with a fast and cost-effective method of reaching the banks of other communities. This partnership enables us to improve the products and level of service we can offer our customers at a fraction of the cost of building a completely new network."

Manfred Schuck, General Manager Marketing & Sales at Equens: "This connection with VocaLink is a logical step for Equens to further expand its payments network in Europe. .Cooperation on infrastructure and competition on services will truly help making SEPA a success. Our network and services provide our clients a fast, efficient and reliable way to send and receive their payments throughout Europe."

The interoperability goal outlined by the EACHA framework fully supports the aims of SEPA and enables the simple and efficient exchange of SEPA payments between CSMs, banks and their customers As both CSMs have more than one settlement cycle per day, customers of VocaLink and Equens will be able to make payments on a same day basis.

About VocaLink

VocaLink is a specialist provider of transaction services to banks, their corporate customers and Government departments. It processes domestic and international automated payments and provides ATM switching solutions. On a peak day, the VocaLink automated payment platform processes over 90 million transactions and over half a billion in a month. Its switching platform connects the world's busiest ATM network of over 60,000 ATMs. Its Real-Time Payments platform provides the central infrastructure for the UK Faster Payments service. It is working with BGC to provide outsourced processing for the majority of Sweden's domestic payments.

Having pioneered electronic payments for over four decades, many of the world's top banks and their corporate customers rely on VocaLink to meet their transaction needs. Its processing services offer banks reach throughout the Single Euro Payments Area (SEPA) and beyond; and are complemented by value-added services that leverage industry expertise and technical capabilities.

Please visit http://www.vocalink.com for more information

About Equens

Equens SE is the first truly pan-European, full-service payment processor. As one of the largest and most innovative payment processors in Europe, Equens is leading the market for future-proof payments and card processing solutions. Thanks to an extensive and competitive service portfolio and a flexible, customer-orientated approach, the company seamlessly meets the requirements of the European payments market. With an annual volume of 7.3 billion payments and 2.1 billion POS and ATM transactions, Equens has a market share of more than 15% within the euro zone. By continuously pursuing further growth and translating the achieved synergy benefits and economies of scale into advantages for the customer, the company contributes to the efficiency of European payments.

Please visit http://www.equens.com for more information

(1) European Automated Clearing House Association

(2) Clearing & Settlement Mechanisms

Distributed by PR Newswire on behalf of VocaLink and Equens

FINEXTRA
03 September 2008

Failed payments costing Europe's banks EUR21bn a year - Misys

Despite the introduction of the single euro payments area this year, failed cross border transactions are costing European banks EUR21 billion a year, according to Misys.

Citing European banking industry estimates, the vendor says up to 41% - or as many as 574 million - cross-border commercial payments fail each year, which equates to around two million transactions each day.

Misys estimates the the average repair cost for each failed transaction at EUR36, putting the total bill at nearly EUR21 billion.

The benefits of Sepa are being eroded by poor processes and inadequate infrastructure, says the vendor. Cross-border payment failures are caused by a number of factors including weak payment initiation controls, poor process monitoring and problems during clearing and settlement. Misys says one of the prime causes is missing or incorrect reference data, which is responsible for 30% of all failures according to Swift.

"Little more than a third of cross-border commercial payments are completed using STP today," says Barry Kislingbury, global product manager, payments and financial messaging, Misys. "Banks are left with the cost of putting these payments back on track - costs they are unable to pass on to customers."

Kislingbury warns that with global trade volumes continuing to hit double-digit growth each year, the problem is going to get worse.

"Significant gains in STP rates can be achieved by utilising reference data within existing payment infrastructures without having to re-engineer a bank's entire systems," says Kislingbury. "Through targeted improvements in specific processes such as payments acquisition, validation and enrichment we can help banks to become more efficient and innovative and rise to the challenge of the new payments environment without undertaking major risk."

Research released by LogicaCMG in April last year predicted that the cost to banks of dealing with failed Sepa transactions alone would hit EUR1.3 billion as banks and their customers grappled with the new payment instruments.

More recent research from e-payments firm Fundtech found that almost half of European banks expect it to take over five years to replace payments-related revenue lost following the introduction of Sepa. Around 13% of banks said they will never be able to recover the lost revenue.

FINEXTRA
04 September 2008 - 09:12

EC moves to kick start Sepa direct debit scheme

EU authorities have called on banks to push ahead with plans to introduce a pan-European direct debit payments system, even if interchange fees are initially charged for cross-border transactions.

In a statement the European Commission (EC) and the European Central Bank (ECB) say they have indicated to the European Payments Council (EPC) that they would be prepared to support the idea of a multilateral interchange fee on condition that the charges were "objectively justified and transitional".

In order for Sepa direct debit to take off "the right incentives should be in place", so interchange fees can b applied for Sepa direct debit transactions "during a limited and well defined transitional phase", says the EC and ECB. After this transitional phase all multilateral interchange fees would be scrapped.

The move - which is at odds with the EC's previous statements on interchange fees - highlights serious concerns about the delay in rolling out cross-border direct debit system in the singe euro payments area.

Europe's banks missed the first Sepa deadline for direct debits due in part to delays in passing a new Payment Services Directive (PSD). Now ECB executive board member Gertrude Tumpel-Gugerell says it would "not be acceptable that bankers are not able to deliver the Sepa direct debits by a November 2009 deadline.

"A European solution has to be found by the banks which are also agreeable to the competition authorities. But Sepa direct debits have to be rolled out in a little more than one year from now," states Tumpel-Gugerell. "In this respect, the idea of maintaining at national level the same interchange fee for national legacy and Sepa schemes during a limited transitional phase should facilitate the rolling out of the Sepa direct debit scheme. This would also ensure the necessary level playing-field in the national context for the Sepa direct debit scheme and the national legacy direct debit schemes."

However the move does appear to back-track on moves by Competition Commissioner Neelie Kroes to crack down on the non-negotiable interchange fees that banks and card companies charge for cross-border card transactions.

"It may prove necessary to have a multilateral interchange fee for cross border Sepa direct debits in the very initial stage," says Kroes in the statement. "But we will have to be convinced that these fees will be strictly limited in time and objectively justified, i.e. are not aimed at providing additional profits to banks."

However last year Kroes ordered MasterCard to cut the interchange fees it charges for cross-border credit and debit transactions in Europe, as it violated EC Treaty regulations. MasterCard lodged an appeal against the ruling but suspended the fees in June in order to avoid heavy daily penalties.

In March, the EC launched an investigation into the interchange fees charged by Visa for cross-border card transactions. The new probe follows the expiry of a 2002 antitrust agreement between the card company and the EU's competition commission when Visa agreed to reduce levels of interchange fees for processing card transactions in return for immunity from legal action.

MasterCard has previously warned that the EC's actions over interchange fees could could deter "investment in Sepa initiatives" and warned that banks may not be inclined to invest in Sepa while the EC debates what to do with interchange fees.

In its progress report last year the ECB called on the banking industry to set up a rival debit card scheme to challenge the dominance of MasterCard's Maestro in Sepa, but warned that the current uncertainty in the market surrounding interchange fees was "hampering the transformation of existing domestic schemes and the start of potential new schemes offering a European alternative".