Estonian companies are ready to go fully over to SEPA
At a meeting on Thursday of the Estonian Payment Forum in Eesti Pank, the banks confirmed that companies that make bulk payments have largely finished upgrading their systems and the conditions of the Single Euro Payments Area (SEPA) will apply in full from 1 February 2016.
“By now, most companies that use bulk payments have adopted the new format or are finishing working on it, so we can confirm that Estonia will make the final transition to SEPA smoothly. This will not mean any additional changes for private individuals. It should be remembered that from February next year it will only be possible to make bank transfers using the IBAN format for bank account numbers. Though in fact it is now generally the rule in most banks to use the IBAN, and people have got used to that change”, said Madis Müller, Deputy Governor of Eesti Pank.
Companies making bulk payments have had two years to change over to the new format for payments. During this time, the banks had to provide conversion services, which they may provide from February next year as an extra service.
The initial deadline for the Estonian changeover to SEPA was February this year, and companies should have been ready by then to use only the new format for their bulk payments. By that date however, only 53% of companies making bulk payments had made the necessary changes. As a result, the central bank, the Estonian Banking Association, the Ministry of Finance and market participants decided that the deadline should be extended by a year to 1 February 2016, which was the maximum transmission period for Estonia.
The Estonian Payment Forum also discussed current topics relating to settlements in Europe and the current state of legislation for settlements in the European Union and within Estonia.
It is principally large companies that are affected by the move to the new format for bulk payments. Companies that make bulk payments had to update their IT systems to fit with the ISO 20022 XML messaging format. Ten of the banks operating in Estonia offer a service for bulk payments.
The banks made all the necessary changes for private individual clients themselves and the domestic bank account numbers were automatically converted into the IBAN, or International Bank Account Number. When the changeover period ends on 1 February 2016, private clients will only be able to use the IBAN,
The Estonian Payment Forum was founded jointly in April 2012 by Eesti Pank, the Estonian Banking Association and the Ministry of Finance, and is also attended by the banks and other market participants. The forum is chaired by Eesti Pank. More detailed information about the Forum, including the topics discussed there and the participants, can be found in Estonian at www.pangaliit.ee/maksefoorum.