As Europe nears the Sepa migration deadline, the continent's businesses risk losing billions of euros thanks to simple payment errors, according to a report from Experian.
Sepa may be designed to simplify and streamline processing operations for domestic and international payments but it will also expose out-of-date account data and other errors that were previously overcome through a patchwork of locally implemented fixes, warns the vendor.
It has analysed more than half a million bank account records held by businesses around Europe, and claims that 12% of electronic payments made to and from firms in euros currently contain data errors that could critically block the timely and cost-effective transfer of funds when new Sepa legislation comes into effect in February 2014.
Only 65% of euro transactions are underpinned by fully accurate destination account data, while 45% of new Sepa-compliant Ibans stored by large European businesses do not have the valid corresponding BICs required to enable successful completion of transactions.
Experian argues that these error types will lead to payment failure when made through Sepa, costing businesses approximately EUR50 a time, leaving a total bill of more than EUR20 billion a year.
Jonathan Williams, director, payment strategy, Experian, says: "While Sepa will undoubtedly benefit organisations trading in euros, errors in bank account details held by European businesses risk causing significant teething problems as locally implemented fixes - which have largely worked so far - are made redundant by the new common payments system."