VocaLink ditches Sepa services
22 August 2011 | 16881 views | 4
UK payments processor VocaLink is abandoning its single euro payments area (Sepa) services, blaming "comparatively low" volumes for the project's instruments.
VocaLink has enthusiastically sought to take advantage of Sepa as a means of expanding its European presence, signing up some of the world's biggest banks - including ABN Amro, Bank of America, Citi, RBS and Santander - for its Euro CSM offering as early as 2007.
In 2009 the company secured £60 million equity capital investment from its bank and building society shareholders to accelerate the expansion before putting Fred Bär in charge of a new Euro services business.
However, uptake of both Sepa direct debits and credit transfers has been sluggish, prompting long and tortuous negotiations towards the setting of migration deadlines.
Despite the fact that these deadlines now seem on the verge of being set, VocaLink says it will make a "phased withdrawal of its Euro CSM and Sepa value added services".
"Whilst Sepa has been a positive development for Europe, volumes remain comparatively low. As a result, we have decided to realign our global products to reflect our customers' current priorities around immediate payments," says Marion King, CEO, VocaLink.
As part of the latest organisational restructuring, it is creating a 'global transaction services' team that under Marc Terry will "deliver a wide range of services to global customers and partners through its unique immediate payments expertise and leading presence in clearing and switching".