A core group of seven German banks are to use EBA Clearing's pan-European Automated Clearing House Step2 for processing Sepa-compliant domestic payments in euros. Under the plans - announced today by representatives from the private banking, savings banking and cooperative banking sectors at the payments conference EBAday in Berlin - Step2 will support at least seven German payment banks in exchanging national credit transfers and direct debits in the Sepa formats.

The new system will progressively replace the direct bilateral exchange of national mass payments currently taking place between the individual financial institutions under the 'Garagenclearing' process.

In anticipation of a surge in domestic Sepa payments volumes, EBA Clearing says it will open a third processing site (in November 2013), and introduce a German customer support service from its offices in Frankfurt.

Currently, about one third of all Sepa Credit Transfers and almost 75% of all Sepa Direct Debits processed by mass payment systems in the eurozone are exchanged via Step2. Apart from cross-border payments, the platform also processes the domestic payment traffic of the banking communities in Finland, Luxembourg and Ireland.