Thursday 6th December, 2012

A study by Steria, a leading provider of IT-enabled business services, prepared in partnership with international Strategy consulting firm Edgar, Dunn & Company (EDC) reveals one in five European businesses are unaware of Single Euro Payments Area (SEPA) direct debits.

The report, based on a survey of 300 businesses with 250 to 5,000 employees in France, Germany and the UK, shows that, organisations risk missing out on the benefits of migrating.

SEPA will affect the vast majority of EU businesses with all organisations using credit transfers or direct debits in Euros needing to migrate by February 2014.

Only one third of organisations 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). More than 60% of businesses in the UK have not started to work on migration to SEPA at all.

Despite this, more than half of European businesses agree that the SEPA Direct Debit scheme will generate more benefits than disadvantages to organisations. SEPA is an opportunity for businesses to plan ahead, redesign cash management systems and processes and generate synergies between business units – a key benefit in today's economy. But, to reap these benefits, it is vital that organisations plan thoroughly and migrate properly.

The study also found that a quarter of European businesses are considering working with external payment partners to help them to migrate adequately.

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.