SEPA harmonises payments
The account number format when SEPA is valid
SEPA will cause changes to material transfer services
Is your company ready for SEPA?
SEPA Extra
pg. 2 pg. 6 pg.8 pg. 20
SEPA (Single Euro Payments Area) is an initiative launched by the EU and
the European Central Bank with the purpose of establishing a home
mar-ket area for payments that covers the entire European Economic Area.
Payments in euro within the SEPA area will not differ from domestic payments in the future; the payments will be forwarded under the same terms and conditions, standards and prices as domestic payments. Initially, SEPA services will include credit transfer, direct debit and cards, but services are being developed for other forms of payment transactions as well.SEPA services will be implemented gradually, and they will replace the current domestic payment transaction services after a transition period. The transi-tion period has been planned to last until the end of 31.10.2011 in Finland with regard to credit transfers and cards, although banks may accept old-fashioned credit transfer data as an additional service longer than that.
sent. In account reporting the cur-rent electronical information format (KTO) will still be used. For example, Sampo Bank will transfer the electronical account statements account statements and reference data in the current format through the PATU channel, and subsequent-ly also through the new Web Serv-ices channel.
Account reporting messages in the XML format will replace the current electronical account statements account statements and reference lists during the next few years.
Web Services channel
You will be able to choose whether to send material to the Bank through the PATU or the Web Services chan-nel in the future. Additional infor-mation on the adoption of the Web Services channel is available from the supplier of your electronic bank-ing software.
Debit cards
If your company accepts card payments, ensure that you have a chip payment terminal and that the
Business Online in the SEPA era
If you use Business Online for material transfer, ensure that you will have SEPA-compatible versions of your programs producing payment data in the course of next year. If you pay your invoices individually, no measures are required by you due to the data changes.
Sampo Linkki in the SEPA era
The SEPA version of Sampo Linkki will automatically convert payment data in the current format to comply with the SEPA standard (XML ISO 20022) and account numbers from the domestic format into the IBAN format. But remember to use IBAN account numbers and the BIC code in your invoicing in the future. In addition, note that following the implementation of SEPA, the due date in salary data is specified as the data debit date instead of the payday. The due date is always one banking day before the payday.
Format of feedback material (e.g.,
account statements, reference lists)
The XML ISO 20022 format will first be adopted for payment data to be
payment terminal has been updated to accept international Debit cards. Suppliers of payment terminals and POS systems will provide additional information on chip payment termi-nals. SEPA direct debit differs sig-nificantly from the current domestic direct debit.
Direct debit
SEPA direct debit is offered as an alternative to domestic direct debit. The service will be offered to payer and creditor customers alike.
Alternatively, you may adopt e- invoicing. The aim is to make the transition from the current direct debit to e-invoices as easy as pos-sible by converting the direct debit authorisations into the e-invoice service and by expanding the e- invoice service to also cover customers without web bank serv-ices. The conversion of direct debit authorisations to the e-invoice service is subject to approval by the authorities.
The Single Euro Payment Area (SEPA) allows customers to use a SEPA
transfer in domestic payments in Finland. The customers must use an
IBAN account number and BIC bank identifiers in the SEPA transfer.
The start-up of IBAN and BIC is making progress step-by-step in
domestic payment traffic.
The account number format
when SEPA is valid
to use ISO 20022 XML materials. The transition period ended on 31 December 2010, after which the banks can still offer the reception service for the payment data to be removed as a special service until 31 October 2011.
Direct debit:
• Domestic account numbers will be used in the domestic direct debit data in future as well. When necessary, the IBAN
identi-fier may be changed to a domestic
account number by removing its
four first digits.
• IBAN is always used in the SEPA direct debit service.
Invoices:
• As of 1 July 2010, the use of IBAN and BIC has been man-datory on paper invoices and account transfer forms, besides the domestic account number.
• The bank bar code in invoices may be changed to IBAN format as from December 2010.
Payments:
• If you pay invoices one by one via eBanking, you can use your national account number or IBAN until 31 October 2011. After that, only IBAN is applicable.
• If you send payment data to the bank, it must contain IBAN and
One of the changes caused by SEPA will be the new C2B XML payment
data format for payment transactions between companies, based on
the ISO 20022 standard and the XML format. The current PATU channel
and the new Web Services channel will be used for the transfer of
C2B XML payment data.
SEPA will cause changes to material
transfer services
(LM02/03), foreign payments (LUM), and recurrent payments (TS). A status report will be avai-lable on the status of payments, providing feedback for the sender of the C2B payment data about whether the payment has been accepted or rejected. The current electronical account statements account statements and reference lists will also be replaced by B2C account reporting messages. The XML account statement has been approved by the Finnish Accounting Board as valid accounting material.
What are Web Services and the
PKI key?
The Web Services channel is a new mode for communication between computers, based on international standards. Data security and
identi-fication on the Web Services channel
are based on a PKI key (Public Key Infrastructure). On the new chan-nel, the encryption of the data com-munication connection and the en-cryption of the material transferred are separate, whereby the data se-curity level of payment transfer will be improved even further.
The PKI key solution is an advance in terms of data security, replacing the PATU keys by a new and mo-dern international standard.
The Web Services channel and the PKI key are not directly based on SEPA, but support its adoption.
C2B XML payment data
The C2B account transfer message is a new account transfer standard. It will replace the current message standards for domestic payments
You can take payment services in accordance with the SEPA standard
into use. You can send payment file to Sampo Bank through a
PATU connection of electronic banking software or through
Business Online.
You can send all domestic payments, including recurrent payments, money orders and urgent payment orders, as well as foreign payments and MT101 orders in accordance with the SEPA standard. For Danske Bank Helsinki Branch –customers it is possible to send payment files through Business Online or Web Services-channel.
The C2B XML file transfer
service for SEPA
Please note
• Enter into an agreement concerning XML file transfer services at your Sampo Bank branch if you are sending payment file to
Sampo Bank through electronic banking software.
• A separate agreement concerning XML file transfer services is not necessary if you use Business Online for file transfers.
• Contact Sampo Bank’s Software and file transfer services, weekdays 8 a.m. to 5 p.m., tel. 0600 125 25 (EUR 1.27/min +local network char-ge/mobile network charge) before sending the first XML material so that we can check the success of the transmission and processing.
With SEPA, the Single Euro Payment Area, the domestic data formats of
payment transactions will be abandoned and the SEPA credit transfer, which
is based on the international XML ISO 20022 standard, will be adopted for
domestic payments. For customers using Sampo Linkki, Sampo Bank’s
proprietary electronic banking software, adopting SEPA will be easier.
The adoption of the new data format means that companies will have to
update their financial administration software to prepare for the SEPA
era. However, customers using Sampo Linkki do not need to carry out
SEPA-related software updates by the end of the SEPA transition period.
The SEPA version of Sampo Linkki
prepares your company for SEPA
without effort
Materials retrieved will change to the XML data format at a later stage, and no specific date has been set for abandoning feed-back material in the current format. However, the SEPA version of Sampo Linkki is necessary for making payments.
• A service for converting payment data to the XML ISO 20022 format
• Automatic conversion of ac-count numbers from the do-mestic format to the IBAN format
• A Web Services connection, which will be implemented for Sampo Linkki this spring.
But even if customers using Sampo Linkki avoid software updates, they must take care of the following SEPA-related changes, for example:
• Use IBAN account numbers and the BIC code in their invoicing
• Ensure that, in the SEPA era, the due date in salary data is spe-cified as the data debit date instead of the payday. The due date is always one banking day before the payday.
Sampo Bank offers its customers and software providers an opportunity for
testing C2B XML payment data. Usually, software providers ensure that the
payment data generated by software have been tested carefully with all banks.
In addition to this, we recommend that our customers test C2B XML data
with Sampo Bank prior to adopting SEPA-compliant software.
The service is also available for Danske Bank Helsinki Branch-customers.
Customer testing of Sampo
Bank’s XML data
Testing phases
Software houses should review all of the phases listed below. Other customers should at least review phases 1 and 4:
1. Contact your financial manage -ment software supplier and en-sure your provider’s SEPA com-pliance and the schedule of your system’s SEPA update.
2. Test the formal correctness of the XML data using a suitable XML validation tool.
3. Compare the XML data with Sam-po Bank’s service and record de-scriptions and model messages that are available at www.sam-popankki.fi > Business > Medium business > Cash Management > Material transmission services 4. Submit the XML data to Sampo
Bank’s testing e-mail box
xml-testaus@sampopankki.fi and en-close your contact details.
Testing in the test
environment
• The testing takes place by sub-mitting the XML test data as an e-mail attachment to Sampo Bank’s e-mail address: xml-testaus@ sampopankki.fi. It is not pos-sible to submit test data directly into the bank’s test environment. • In the test data, the customer’s identifier is 12345678 (Busi-ness ID) and the IBAN-format accounts FI9881234511224480 and FI2181234522334470 are used as debit and credit accounts (as a credit account only if it is a domestic payment and the recipient’s account is a domes-tic one).
• Sampo Bank will report feedback on the success of processing the data by e-mail.
The Web Services channel is a safe and modern data
communica-tions solution that enables material transfer between company’s
financial management systems and the banks. The Web Servic
-es connection can be generated either with eBanking software or
directly from company’s financial management systems.
The Web Services channel can be used both with eBanking software programmes and in direct connections as a channel between the customer’s financial management system and the bank’s system. The Web Services channel is first used for transferring new data in the ISO 20022 XML-compliant format but later it can be used for sending all kinds of files. In future, the Web Services channel can also be used for other purposes than transferring payment transactions.
International standard
in the background
Sampo Bank’s Web Services rely on information security and mes-sage determination system jointly applied by Finnish banks. The Web Services-channel is available for Sampo Bank’s customers. It will be available for Danske Bank Helsinki Branch –customers in April 2011. The bank identifier based security protocols currently used by Web Services connections will be replaced with a new Public Key In-frastructure (PKI) security protocol that covers the encryption of the communications connection as well.
Easy adoption
The easiest way to start to use the Web Services channel is to adopt an eBanking software version that supports the Web Services con-nection. Additional information is available at the support for Sampo
Bank’s Software and Material Trans-fer services, if the customers want to build the communication proto-col in their systems by themselves.
Additional information
• Support for Software and MaterialTransfer services, tel. +358 (0)600 125 25, Mon-Fri from 8:00 a.m. to 5:00 p.m. (1.18 €/min + lnc/mpc)
• eBanking Customer Support, tel. +358 (0)100 2580/2, Mon-Fri from 8:00 a.m. to 5:00 p.m. (lnc/mpc)
• Technical description is available on the websites of the Federation of Finnish Financial Services at: www.fkl.fi
The SEPA direct debit service is intended for both invoicing and paying customers. The service best suits companies that debit in euros the accounts of their cus-tomers living abroad, as the SEPA direct debit service enables debiting in one and the same format throughout the whole SEPA area. If desirable, the company may use the service for debiting the accounts of its Finnish customers.
The SEPA direct debit service is different from
the domestic direct debit service
The difference between SEPA direct debit and domestic direct debit services is that the authorisation is given directly to the invoicing party in the SEPA direct debit service, instead of giving it to the bank as in the domestic direct debit service. The invoicing party is in charge of the management of direct debit authorisations and
the identification of the paying customer. In addition to recurrent payments, the
SEPA direct debit system is suitable for debiting individual payments.
Both SEPA direct debit models are available to
customers
There are two SEPA direct debit models: the basic model and the business-to- business direct debit model. In both models, the paying and invoicing customers will make a SEPA direct debit agreement with Sampo Bank.
party with a direct debit authori-sation. Moreover, the payers must provide information about the authorisation to their own banks to enable the payer’s bank to check the correctness of the authorisation information before debiting the payer’s account. • The payer has no right to
reim-bursement.
• The payer using Sampo Bank is en-titled to reimbursement within four (4) months from debiting, if the deb-it was made wdeb-ithout authorisation.
The present domestic
direct debit system
will end in three to
four years.
Once the domestic direct debit service has ended, invoicing parties may transfer to use either the SEPA direct debit system or the eInvoice service. The banks are presently all together developing an automatic eInvoice payment service to allow custom-ers without eBanking facility to use
Basic model (core)
• May be used as the debiting system of both consumers and companies. • The payer provides the invoicing party with a direct debit author-isation.
• Sampo Bank requires, however, that the bank and the paying customer have an agreement concerning the use of the service. • The payer may demand a
reim-bursement of the direct debit sum for any reason whatsoever within eight (8) weeks from debiting and within 13 months after the pay-ment of the invoice, if debiting was performed without authorisation.
Business-to-
business SEPA direct
debit (B2B)
• Intended only for direct debiting between companies.
eInvoices. In this case, the customer
gets advance notification of an
eInvoice from the invoicing party and the customer’s account will be auto-matically debited with the invoiced sum on the due date. If the customers to be debited live in Finland, we rec-ommend the use of the eInvoice and the automatic payment service. There is no need to make SEPA chang-es in the domchang-estic direct debit system as it functions in the same way as before until the service is terminated.
Direct debit
authorisations will
not be converted to
SEPA authorisations
Since currently-used direct debit au-thorisations will not be changed to SEPA direct debit authorisations, the customers willing to transfer to use the SEPA direct debit system must re-col-lect authorisations from their custom-ers. The target is to convert domestic direct debit authorisations to such au-thorisations that enable the use of the automatic eInvoice payment service,With SEPA, the Single Euro Payment Area, the SEPA
credit transfer, which is based on the international
IBAN account number and the international XML ISO
20022 standard, will be adopted for domestic
pay-ments in Finland. Read here what this means for
your company.
Do you invoice your customers?
• As of 1 July 2010, IBAN and BIC have been mandatory on invoices and account transfer forms besides the domestic account number. You can obtain your own IBAN and BIC information from Sampo Bank.
Do you pay your invoices individually through eBanking?
• You can use the national account number or the accountnumber in the IBAN format until 31 October 2011 after which only the IBAN account number is valid.
Is your company ready
for SEPA?
ki/PATU connection or through Business Online. Later this year, transfer of materials is also pos-sible through a WebServices con-nection based on a PKI security solution.
How can account numbers
existing in systems be converted
to the IBAN format?
• The company’s own bank connection information and that of its trading and other partners and personnel must be converted to the IBAN format. This may have consequences for the purchases ledger, the sales ledger, the payroll computa-tion program, the cash register system and the travel invoice application, for example.
• It is worthwhile surveying the different alternatives for im-plementing the conversion with Sampo Bank and software suppliers.
• Sampo Bank automatically con-verts account numbers in the
Do you transmit payment data to
the bank through electronic
ban-king software or eBanban-king?
• The XML ISO 20022 payment data will be adopted instead of national payment data formats (LM02, LM03, TS and LUM2). This means that you will need a
SEPA update for your financial
management software or, alter-natively, a payment data con-version service. Suppliers of electronic banking software, for example, offer conversion services. For additional infor-mation, contact Sampo Bank or your software supplier.
• The transition period ended on 31 December 2010, after which banks have the possibility to continue offering the servic-es to be removed as special services until 31 October 2011. After this, banks no longer accept payment materials in the national format.
• You can send payment materials to Sampo Bank through a
Link-recipient list of eBanking into the IBAN format.
What will happen to the account
statement?
• The electronical account state-ments in the current format will still be at your disposal when you start transmitting XML ISO 20022 payment materials. An XML for-mat account statement is being developed, and it will be taken into use later as an alternative to the current account statement. • In addition to the above
chang-es, the SEPA will also change the procedures for card payments and direct debits.
Whom should you contact?
• Sampo Bank to agree on the adop-tion and testing of new XML format payment data. Sampo Bank also provides tips and concrete tools for implementing the SEPA changes. • the supplier of your electronic banking software about the
adoption of a SEPA version
• suppliers of software generating payment data about the adoption of SEPA versions.
Schedule for SEPA services
The transition period regarding account transfers and cards was by the end of 2010. Duration of the transition period regarding direct debiting has not yet been decided.
SEPA versions of financial administration software
Ensure that SEPA compatible versions of your financial administration software (e.g., ledger, payroll computation, and expense report pro-grams) will be available by the end of the transition period.
IBAN account numbers
As, for example, Sampo Bank’s customer, you are provided with IBAN conversion services free of charge in order to convert domestic account numbers into the international IBAN format. The use of conversion serv-ices is recommended if there are many account numbers to convert.
Business Online in the SEPA era
If you use Business Online for material transfer, ensure that you will have SEPA-compatible versions of your programs producing payment data in the course of next year. If you pay your invoices individually, no measures are required by you due to the data changes.
SEPA checklist
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obtains a conversion service, it is necessary to ensure that a version of the electronic banking software that is suitable for sending XML ISO 20022 data will be available.
Payment using Business
Online
Customers that use Business Online for single payments need not worry about data formats and changes. However, customers that use Business Online for data exchange should con-tact their software suppliers and ensure that SEPA-compliant versions of the software producing payment data will be available in time.
Account number
conversion
Domestic account numbers will be re-placed by international IBAN account numbers. A company may utilise ac-count number conversion services when the company’s own, employees’ salary accounts and partners’ accounts are converted into the IBAN format. The use of conversion services is recom-mended if there are plenty of account numbers to convert. For example Sampo Bank offers its customers an IBAN conversion service free of charge.
SEPA will result in changes
to payments
With SEPA, the domestic standards of payment transactions will be aban-doned as the SEPA credit transfer, which is based on the international XML ISO 20022 standard, will be adopted for domestic payments. Companies that use payment data will submit the data to the bank in the XML ISO 20022 format. In practice, this means that the company should contact its financial administration system suppliers (e.g. suppliers of ledger, payroll computation and expense report software) and ensure that SEPA-compliant versions of the software will be available by the end of the transition period.
Payment using electronic
banking software
A company may also procure conver-sion services from software and inte-gration service suppliers, such as sup-pliers of electronic banking software. With the conversion services, the com-pany’s systems may continue produc-ing payment data usproduc-ing the current standards (LM02, LM03, TS, LUM). Regardless of whether a company that uses electronic banking software
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Cards
SEPA aims at cardholders being able to use their payment cards abroad in addition to their home countries, at least throughout the SEPA area. There-fore, domestic bank cards are being replaced by so-called debit cards con-nected to the bank account in Finland. Companies that accept card payments should ensure that they will have a chip payment terminal and that the payment terminal has been updat-ed to also accept international Debit cards. Suppliers of payment terminals and POS systems will provide addi-tional information on chip payment terminals.
Direct debit
Domestic direct debit as it currently is will end within the next few years. SEPA direct debit is offered as an al-ternative to domestic direct debit. The service is offered to payer and credi-tor customers alike. SEPA direct deb-it differs significantly from the current domestic direct debit. Finnish mass in-voicing parties are, in fact, adopting e-invoicing. The aim is to make the tran-sition from the current direct debit to e-invoices as easy as possible by
con-verting the direct debit authorisations into the e-invoice service and by ex-panding the e-invoice service to also cover customers without Web Bank services. The conversion of direct deb-it authorisations to the e-invoice serv-ice is subject to approval by the au-thorities.
Sampo Linkki electronic
ban-king software
Sampo Bank’s customers that use Sampo Linkki, Sampo Bank’s propri-etary electronic banking software, will avoid SEPA-related software updates. They can adopt the SEPA version of Sampo Linkki, which automatically converts payment data in the current format to comply with the SEPA standard (XML ISO 20022) and account numbers from the domestic format into the IBAN format. However, it should be noticed that Sampo Linkki customers must also use IBAN account numbers in their invoicing and ensure that, following the implemen-tation of SEPA, the due date in salary data is specified as the data debit date instead of the payday. The due date is always one banking day before the payday.
