More evidence about the cost of not making the SEPA end date of 1 February 2014 emerged during the ACT Annual Conference in Liverpool on 1-3 May: the cost of correcting a non-compliant payment or collection will, according to one corporate, be around £50; Human Resources departments are becoming increasingly concerned about not being able to pay their employees across Europe after the end date which will have major consequences in their company. Our understanding of the costs and impacts of not making the end date are growing.

BofA Merrill's EMEA Regional Sales Head Paul Taylor, in his introduction to the 'SEPA readiness: breaking through the hype to the operational reality' session, quoted various statistics on the progress of SEPA adoption by corporates including a startling finding from one survey, which revealed that 55% of corporates expect they will not be ready by the end date!! There is a clear need (which will eventually become desperate) for a Plan B for those who really are not going to make the end date.

Nevertheless, when I asked the panel - made up of corporate treasurers from Wolseley, SAB Miller and British American Tobacco, and BofA Merrill's Paul Miller - at the 'SEPA readiness' session whether they had a Plan B. None of the corporates, who are admittedly pretty organised and will probably make the date, had even thought about it. They came up with ideas such as: opening new accounts, making payments by same day clearing systems. Paul Miller talked about working with their 1,200 corporate clients, who are implementing SEPA, to ensure that they had all the resources and support they needed.

Need for PLAN B
There are going to be many of those 55% of companies who think they are not going to be ready, who truly won't make it. There needs to be a PLAN B such as the allowing some countries and/or corporates a grace period. Whatever happens, SEPA migration is going to be expensive as massive investment is poured into all the new data migration projects and as rejection rates will be huge, in some countries, they have already risen to 15%.