IBAN Impact Check helps businesses get started

DNB launches the Switch to IBAN autumn campaign

Amsterdam, 4 October – “IBAN has consequences for business operations. Companies must act now to be ready in time.” This is the message of the Switch to IBAN autumn campaign, which officially launched today. New findings from De Nederlandsche Bank (DNB)(opens in new window) underline the need to take action. While awareness of IBAN has improved markedly, preparations by small and medium-sized enterprises in particular for the new credit transfer and direct debit standards are still lagging.

By 1 February 2014 at the latest, businesses and consumers will use IBAN, the International Bank Account Number. New European payment standards will also apply. Businesses, public authorities, associations and other organisations must adapt their software and administration so they can use the European standards for direct debits and credit transfers. If they are not ready in time, they will no longer be able to make or receive payments.

IBAN awareness rises, SME preparations lag

New findings from the autumn 2012 SEPA monitor show that awareness of IBAN among SMEs and medium-sized businesses has increased: 89% of SMEs and 100% of medium-sized businesses are familiar with IBAN. In addition, 57% of SMEs now understand the changes the new payment standards will bring for their business, compared with only 30% six months ago. Nevertheless, more than a third of SMEs, 37%, and 7% of medium-sized businesses still have no insight into the changes resulting from SEPA. Practical preparations remain rare: 78% of SMEs have not begun preparing for European direct debit standards and 70% are unprepared for European credit transfer standards. This is a small improvement on six months earlier, when 80% had made no preparations for the new direct debits and 85% were unprepared for the new credit transfers. Frank Elderson, a DNB Executive Director and Chair of the National Forum for SEPA Migration (NFS), says: “Businesses are considerably more familiar with the transition to IBAN, but SMEs in particular are still making too few preparations, even though IBAN can have a major impact on a business.”

In the SEPA monitor, the following definitions are used: SMEs have 1–199 employees, medium-sized businesses have 200–999 employees and large businesses have 1,000 or more employees.

Europe is moving towards a common payments market, the Single Euro Payments Area (SEPA), where euro payments will be made in the same way everywhere. SEPA includes all EU countries, together with Norway, Iceland and Liechtenstein, which belong to the European Economic Area, as well as Switzerland and Monaco. New European payment standards are being introduced to ensure that euro payments are processed uniformly throughout this area.

IBAN Impact Check

Businesses do not always have sufficient insight into the consequences of the transition to IBAN. The NFS has therefore developed the IBAN Impact Check, an online tool at overopIBAN.nl showing businesses which steps they must take to be ready. The check takes account of the different payment systems a business may use. Direct debits, for example, will change substantially. The time required to adapt ranges from several months to as much as a year and a half. Eleven specific questions place the business in one of three categories indicating the likely impact and the measures it must take. The questions cover areas including software for credit transfers, Acceptgiros, batch transactions and online banking. The business receives a brief explanation of relevant issues and is advised to contact its bank or software supplier in good time.

Campaign launch

The Switch to IBAN autumn campaign launched during an industry association event organised by VNO-NCW, MKB-Nederland and DNB. NFS Chair Frank Elderson called on trade associations to actively encourage their members to begin the transition to IBAN as soon as possible. He was supported by Richard van Zwol, Secretary-General of the Ministry of Finance: “Large businesses have already discovered that moving to IBAN involves more work than might first appear. It is naturally harder for medium-sized and small businesses to make time for it. But the effort is required only once and is absolutely worthwhile, because the Netherlands’ open economy earns a great deal from international trade. A single European payments market will make that even easier.”

At Van Zwol’s invitation, MKB-Nederland Chair Hans Biesheuvel completed the first IBAN Impact Check. The organisation was placed in category three, meaning that the transition activities would take an average of one to one and a half years. Biesheuvel was not surprised: “The steps identified by the IBAN Impact Check clearly show that it is wise to start in good time. At MKB-Nederland, we have therefore been busy for some time organising and carrying out the necessary activities relating to IBAN, credit transfers and direct debits. For example, we contacted our bank and software supplier about the required changes.”

The Switch to IBAN autumn campaign

The Switch to IBAN public information campaign will focus on businesses in the coming months because they must allow sufficient time for the various steps involved. Radio advertisements, banners and the campaign website will inform businesses about the transition. A special toolkit provides visual material for their own communications. During the campaign presentation, Frank Elderson called on trade associations to alert their members to the need to begin preparations in good time.

The Dutch IBAN migration is coordinated by the National Forum for SEPA Migration (NFS), which brings together representatives of banks, businesses, consumers, public authorities, software suppliers and other organisations. They agree how the Dutch payments market will migrate.

The National Forum on the Payment System (MOB) established the NFS to organise the transition to IBAN and SEPA with the commitment of the parties involved. The NFS is chaired by De Nederlandsche Bank.