European Parliament approves plans to extend Sepa migration deadline
04 February 2014 | 6960 views | 0
The European Parliament has voted in favour of proposals to extend the migration deadline for processing Sepa-compliant payment transfers by six months, to August 2014.
Under plans tabled by the Commission last month, businesses will have an extra grace period of six months to prepare their systems for accepting Sepa credit and debit transfers before legacy payment instruments are blocked.
The move was mooted in light of migration data which indicted that a substantial number of market participants and particularly SMEs would not have fully migrated to the new common standards by 1 February.
"The objective is to ensure payments are not blocked in cases where stakeholders are not ready, and thus minimise any possible risk of disruption to payments for consumers and businesses, in particular SMEs," says internal market and services commissioner Michel Barnier. "Payment service users can thus be certain that their payments will continue to be processed, and those who have not yet migrated have the time to do so. The proposal will apply with retroactive effect."
The idea has met with resistance from the Eurosystem of central banks, which has been urging the region's banks to be ready for the original Sepa migration end date of 1 February 2014.
Recent statistics released by the European Central Bank (ECB) show that Sepa migration rates picked up strongly in December, with 74% of credit transfers and 41% of direct debits in the euro area already Sepa-compliant.
But with the European parliament now endorsing the Commission's extended timetable, formal adoption by the European Council is expected to take place in the coming days.