Thursday, October 24 12:03:00
Many businesses are leaving late their migration to a new euro zone payments system and risk disruptions by changing over at the last minute, a European Central Bank board member said today.
The Single Euro Payments Area (SEPA) project is aimed at simplifying bank transfers and direct debit operations in the 17-country bloc but many firms are only shifting to the new system in the final quarter of 2013, before a Feb. 1 2014 start.
SEPA is seen by the European Union as unlocking economic growth by giving the bloc's 500 million consumers more choice by being able to shop cross-border more cheaply and easily, all from one bank account.
With 100 days to go, the ECB said the changeover was entering a critical phase ahead of the Feb. 1 start, which could not be delayed. The pace of migration for credit transfers was healthy in most countries but lagging behind for direct debits.
"I have said this before and will repeat it: everybody has to be ready on 1 February 2014 or risk disruptions in their individual handling of payment orders," ECB Executive Board member Benoit Coeure said.
An ECB report showed "big billers" and large corporates in Germany were particularly unprepared for the switchover.
Coeure said the process was more complicated in bigger countries, many of which planned a "big bang" changeover with all stakeholders in the new system moving at the same time and at the last minute.
"This is where we see risks, because there the coordination and operational implementation is more risky, but it is still possible," he added. (Reuters)