In a new report entitled “SEPA: will European businesses be ready for the transformation”, Steria and Edgar, Dunn & Company have found that One in five European businesses (21%) issuing debits is unaware of Single Euro Payments Area (SEPA) direct debits. The firms conducted a survey of 300 businesses in France, Germany and the UK. Shockingly, just a third of organisations (31%) has migrated or is in the process of migrating to SEPA Direct Debit (42% in Germany, 35% in France and only 3% in the UK).
Despite more than half of European businesses agreeing that the SEPA Direct Debit scheme will generate more benefits than disadvantages, many have failed to prepare for it. With a year to go, 30% of French and German businesses and more than 60% in the UK have not started to work on migration to SEPA at all. The remaining organisations are only assessing the project of migrating, the report has found.
Jean-François Mansart, Head of the Group Advanced Payments practice, explains “Organisations that view SEPA as merely a compliance burden are missing a trick. Smart companies will take SEPA as an opportunity to optimise their cash management systems and processes and reduce fraud and bad debt. But they need to allow themselves adequate time to prepare to avoid potentially costly errors and to ensure that the benefits outweigh the costs of migrating.
The study found that a quarter of European businesses are considering working with external payment partners to help them to migrate adequately. Three European banking associations have recently published a guide to help European companies better understand SEPA regulation and to give practical guidance on how to apply it.
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