French payments platform Numeral is joining the U.K.’s fight against IBAN discrimination.
The banking aggregation and payment automation platform announced Tuesday (Mar. 14) it was launching in Great Britain, where it will let FinTech companies access SEPA (Single Euro Payments Area), Bacs, and FPS (Faster Payment Services) through its banking partners.
“As Europe’s leading FinTech hub and a prime destination for global FinTech companies in their international expansion, the U.K. is a point of entry to continental Europe for financial innovators,” the company said in a news release.
But since Brexit, customers of U.K. FinTech companies have faced renewed cases of IBAN discrimination, a term for what happens when businesses or employers refuse to accept an International Bank Account Number (IBAN) for payment in euros due to its country code, thus denying consumers access to services.
As noted here last year, IBANs are an internationally-agreed system for identifying bank accounts across global borders. The EU’s Single Euro Payments Area regulation has for years required banks and businesses to accept IBANs from any member state.
“That means an Irish business can’t refuse payment from a SEPA-based account just because they don’t have an Irish IBAN, for example,” PYMNTS wrote. “Likewise, Article 9 also mandates that an employer can’t require that its employees hold local bank accounts to get paid.”
So why do employers, merchants and banks continue to discriminate?
“Ultimately, many of the issues with IBAN discrimination boil down to a lack of knowledge of the rules,” PYMNTS wrote. “Not all companies and direct debit issuers are familiar with the relevant regulations; for example, many organizations aren’t aware of their obligation to accept euro payments from IBAN numbers regardless of the SEPA they are from.”
“Using Numeral, U.K. FinTech companies can connect to and send and receive SEPA payments with the EU banks of their choice, effectively benefiting from EU IBANs,” said Édouard Mandon, co-founder and CEO of Numeral.
“More advanced companies seeking to obtain an EU payment institution or electronic money institution license can also become SEPA participants and issue their own EU IBANs. Numeral helps these companies connect to their SEPA sponsor bank and process their SEPA payments.”