New euro payments market comes into effect as VocaLink processes first transaction

London, 28 January 2008: Today saw the introduction of the Single Euro Payment Area (SEPA), a regulatory change which will create a single payments market across 31 countries in Europe. People and companies will be able to make payments electronically easily and inexpensively across Europe using the same payment systems. It will allow financial transactions between banks in different countries, crossing national borders, to be handled as if they were between banks in the same country. 

VocaLink, the specialist provider of transaction services to banks, processed its first SEPA transaction today. Last summer VocaLink announced its intention to launch a pan-European Clearing & Settlement Mechanism, the VocaLink EuroCSM, to handle SEPA payments for banks and their customers. On day one of SEPA the EuroCSM processed its first transaction, a euro payment from the Austrian bank BAWAG P.S.K.. to Fortis in Belgium. Initial transactions will be SEPA Credit Transfers (SCT).

The next milestone for SEPA will be the introduction of SEPA Direct Debits (SDD) in 2009 when the Payments Services Directive (PSD) will become enshrined in national law.

Martin Wilson, chief marketing officer at VocaLink said: “SEPA is set to revolutionise the payments industry in Europe as well as the way in which banks and their business customers work together. VocaLink provides support to deliver cost-effective services and a technology infrastructure to help banks meet customer demands and be competitive in the SEPA. We are now processing SEPA Credit Transfers (SCT) and are already working with our customers to help them prepare for SEPA Direct Debit (SDD) in 2009’’.

VocaLink processes 15% of all automated transactions in Europe and all UK standing orders, credit transfers, direct debits, and ATM transactions, totalling over 9 billion payments a year. VocaLink has successfully processed transactions in the UK for the past 40 years. Ninety per cent of UK salaries and seventy per cent of domestic bills are processed through VocaLink’s systems.