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26 October 2010

Commission published 3rd survey on public administrations’ readiness and migration to SEPA

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Public administrations' migration used the Single Euro Payments Area for 2.7 per cent of their credit transfers as of the end of February, up from 1.5 per cent last September, according to European Commission data published in the survey.

The survey on public administrations’ (PA) migration to SEPA is conducted by the Commission services biannually, on the basis of the commitment undertaken in the first priority area of the SEPA Roadmap. In this context, two surveys have already been conducted by the Commission Services, focussing on the SEPA Credit Transfer (SCT).
The results of these surveys have been published on the Commission Services website. This third survey, for the first time, covers also general information on SEPA Direct Debit (SDD) preparedness or uptake since as of November 2009, the date from which the new SDD service is being offered by some payment service providers.
The survey analyses the situation as of end February 2010 and confirms that PA clearly lag behind other users in terms of preparedness and migration to SEPA.
The weighted SCT migration rate for the replying PA in the Euro Area was 2.73% and significantly below the overall SCT rate in the Euro Area (6.2% in February 2010). On the positive side, it should be noted that as compared to the last survey, the SCT migration rate by PA has increased (from 1.5% in September 2009) and is expected to rise further by the end of this year, when individual PA at central government or federal level in Belgium, Germany, France and Portugal plan to migrate their domestic traffic to SCT. The expected migration of a large share of payments initiated by central and local governments in France (contributing 60 million payments) and the migration of full payments traffic by the Federal Labour Agency in Germany (251 million payments), will substantially increase the PA migration rate for SCT.
As regards actual SDD migration, the results show that with the exception of Belgium and Germany, PA have not yet started to migrate to SDD. The weighted SDD rate for the replying PA in the Euro Area was only 0.06%, which although low is nevertheless above the overall SDD rate for the Euro Area (0.04% in February 2010). This figure is, however, expected to progressively increase after 1 November 2010, when the reachability obligation under Regulation (EC) No 924/2009 on cross-border payments in the Community comes into force for Euro Area banks. As of that date, banks will have to be reachable for SDD transactions, if they are reachable for national direct debit transactions denominated in euro. On the other hand, it must be recognised that the use of direct debits by PA is generally very low or even nil.
Since SEPA only concerns euro payments and many PA in non-eurozone Member States link the SEPA migration to their potential future accession to the Euro Area, this survey differentiates between PA located in the Euro Area and those situated outside the Euro Area. Furthermore, the potential volumes eligible for migration to SEPA by PA in non-eurozone Member States are relatively limited. For these reasons, PA in Member States outside the Euro Area were only requested to answer questions of a more general nature. With the exception of Romania, where the intention is to offer SEPA standards next to national standards also to transactions in domestic currency (with an upgrade of the local clearing house by end-2010), no Member State outside the Euro Area aims to extend SEPA to its domestic traffic. SEPA standards and formats are currently not used for national and/or cross-border euro credit transfers in non-eurozone Member States, with the exception of one PA in Bulgaria.

© European Commission

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