SAP says the extensions will be designed to help companies meet the challenges of the Sepa framework as defined by the European Payment Council (EPC), by offering direct support for the new ISO20022 messaging standards.

The software will also be re-architected to support payment schemes including the newly created pan-European direct debit, the payment order and the bank statement message. In addition, SAP promises to deliver a bank mandate management component which can be used by both corporations and banks to manage the entire life cycle of the debtor authorisations to initiate collections.

SAP plans to make the package available in mid-2007 for existing customers of SAP R/3 Enterprise or higher.

The package is one of several planned enhancements tapping SAP’s ERP and banking software functionality to streamline corporate banking processes. Chief among these is a new Integration Package for Swift, designed to provide direct interfaces to the global financial messaging network.

SAP says the initiative will help alleviate the complexity and cost incurred by companies worldwide in managing a multitude of separate communication channels for each bank relationship.

With average costs for proprietary bank interfaces exceeding EUR25,000 per year per connection and companies maintaining upwards of 10 banking relationships, the burden on the IT budget can be immense. Additionally, companies often lack seamless integration with their banks via straight-through processing and must import bank statements for multiple banks separately. The results are productivity losses, increased exception handling and lack of cash flow transparency.

The German ERP vendor says the new Integration Package will enable companies to access multiple banks through a single connection for real-time exchange of payment and settlement messages via SwiftNet. The software will be architected with pre-configured message and process mapping between the application interfaces and business logic of the SAP Financial Supply Chain Management application, mySAP ERP Financials and the Swift infrastructure.

It will initially support FIN and FileAct messaging services, enabling companies to send and receive both MT- and MX-based messages.

Johan Kestens, head of marketing at Swift, says of the initiative: "SAP and Swift are making it easier and more cost-efficient for corporate clients to exchange payment, cash management and treasury information with their banks."

The initiative follows Swift's recent agreement to allow direct corporate access to the banking network for the first time.