Tuesday 2nd February, 2016

Less information is now required when sending a Single Euro Payments Area (SEPA) payment from abroad into the UK.

On the 1st February 2016, Article 5(7) of the SEPA Regulation came into force, ensuring that Eurozone banks and Payment Service Providers (PSPs) are able to process SEPA payments using a customer’s IBAN (International Bank Account Number) only. Previously customers were required to also provide a Business Identifier Code (BIC).

As the UK is not a Eurozone country, the Regulation will not apply to UK PSPs until 31st October 2016.

This change should reduce the instances of payment errors, by encouraging more SEPA payments to be made electronically - through Straight Through Processing (STP) - minimising the need for manual intervention.

Payments UK, the Financial Conduct Authority (FCA) and the Bank of England, has led this two year project to provide a SEPA IBAN-Only (SEPAIO) directory developed by SWIFT. The directory provides PSPs with a utility for deriving the BIC from the IBAN.

Maurice Cleaves, Chief Executive of Payments UK said:

“Payments UK has worked across the industry, with a wide range of stakeholders, both nationally and in Europe, to build a clever tool to support the introduction of this new regulatory change that comes into effect today. Our directory, which includes data for over 95% of UK SEPA reachable BICs, goes truly above and beyond, boasting a technologically superior offering.

By incorporating open API criteria into the software, we are demonstrating the emphasis we place on making payments efficient - streamlining and simplifying processes for the end user - and harnessing the latest technology to help us in that regard.”