Discussions with two corporate treasury departments at global MNCs who are well prepared for the SEPA deadline revealed some relief at introduction of the additional six months transition period because there is now:

• additional time to dual run and check their payroll payment runs
• more time to roll out their SEPA Direct Debit programmes which were experiencing a few minor problems including problems with, the DD identifier fields and the legal indemnity agreements with their banks
• time for some of their local banks to upgrade their direct debit systems to become SDD compliant.
• a breathing space to tidy up all sorts of small problems.

BUT the problem of other corporates not being ready has NOT gone away:

• in one MNC only some 50% of their customers are SEPA compliant and so they were expecting a significant ‘hiccup’ to receivables cash flow on 1st February
• the other MNC is trying to set up SDDs so they can direct debit the customer if they cannot pay by SCT
• SMEs are very slow to change, e.g. one MNC changed banks THREE years ago but are still being paid by SMEs into the old bank accounts.

Also, it is unclear whether ALL banks will continue to accept non-SEPA formatted payment instructions after 1 February 2014, which could still ensure that the beginning of February will be the mess we were expecting.

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CTMfile take: Maybe the lesson from all of this is that the authorities should just sit back and leave it to the large MNCs to drive the SEPA conversion of their SME customers. This would ensure that the large majority of SMEs convert to SEPA in the next six months. All the EPC and the banks need to do is to provide support and backup tools to support the large MNCs as they drive this conversion??