Implementation of local and centralized

SEPA payments

The goal of SEPA is to create a single market for payment services, so that all of the participants may perform
payments in an easy, safe and yet affordable way.

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Case Study
SEPA concept

SEPA stands for Single Euro Payments Area, which is a program of cooperation between banks supervised
by the EPC (European Payment Council).

The goal of SEPA is to create a single market for payment services, so that all of the participants may
perform payments in an easy, safe and yet affordable way.

The core idea of the SEPA program is the ability to perform cross-border payments in Euro currency as
though they were domestic payments (mainly in terms of cost and lead time).

The range of SEPA

The first wave of SEPA migration is the Euro zone. In these countries, SEPA is an obligatory form of
settlement in Euro from 01.02.2014.

In the initial stage, countries for which SEPA is not obligatory may participate in it and accept its standards.

In the next stage (31.10.2016), SEPA will become the mandatory form that accounts for all payments in Euro
currency in EU countries belonging and not belonging to the Euro-zone (data from the
http://www.ecb.europa.eu/paym/sepa/about/migration/html/index.en.html ).

Technical Requirements

Credit transfers and direct debit payments in the SEPA system requires the use of a specific payment file
format based on the ISO 20022 standard as an XML file.

At the same time, the direct debit obliges the initiator to have a unique Creditor ID assigned as well as a SEPA
mandate document signed by the Debtor.

Creditor ID may be obtained through the bank.

The template of the SEPA mandate document has been developed by EPC (modifications are permitted).

In terms of master data: valid IBAN and BIC to identify both payer's and beneficiary's bank accounts are
required.
 Solution to the problem
SEPA Payment files are created with the use of use of PMW tool (Payment Medium Workbench). Each of the
banks participating in the SEPA program may have specific format requirements of payment, therefore,
some adjustments are necessary (even if SEPA is a unified format, some of the banks may have additional
requirements). In order to handle these requirements we have created a custom solution enabling file
generation in the exact format that is expected, at the same time keeping the Payment method lists to the
necessary minimum. The solution also includes customer interfaces for automatic file transfer. Special care
has been put to prevent duplicate payments.

To support direct debits (SEPA Direct Debit) new type of SAP master data has been introduced: SEPA
mandate.

SEPA mandate is a standard SAP object associated with the Customer master data.

The obtained benefit

SEPA payments allow significant savings, given that international transfers are treated as domestic
payments.

The implementation of SEPA payment format enables compliance with the legal requirements applicable
from February 2014.

From February 2014 SEPA payment format becomes mandatory in many countries of the European Union.

In Poland, many banks have declared SEPA compliance, which means that you may already benefit from it.

Related external sites::

http://www.nbp.pl/home.aspx?f=/systemplatniczy/sepa/index.htm
http://www.sepapolska.pl/
http://www.europeanpaymentscouncil.eu/
http://www.europeanpaymentscouncil.eu/knowledge_bank_detail.cfm?documents_id=328

CONTACT:

(+48) 22 350 74 55
bpx@bpx.pl
www.bpxglobal.pl