1. SEPA and PE-ACH: Evolving service requirements
Moderator:
Giorgio Ferrero, EBA CLEARING
Speakers:
José Beltran, EBA CLEARING
Thomas Egner, Commerzbank
Björn Flismark, SEB
Serge Wagener, Banque et Caisse d'Epargne de l'Etat

2. The evolution of EBA CLEARING’s SEPA Services
José M Beltrán, Director STEP2 Services, EBA CLEARING 2

3. STEP2 SCT Ramp-up STEP2 SCT currently processes 185,000 payments a day
54% migrated from STEP2 XCT
46% new SEPA payments
STEP2 SCT SEPA domestic
23% of SCT payments are within the same country
STEP2 SCT is SEPA domestic to:
Luxembourg, Finland and major Italian Banks
A number of other countries

4. 14 Technical Facilitators
STEP2 SCT: Participants
111 Direct Participants
4,341 Indirect Participants
95% of FIs having adhered to
the EPC SCT Scheme
Euro SIC
VOCALINK
IBERPAY
SCC
EQUENS (DE)
SIBS
DIAS
KIR
EQUENS (NL)
STEP.AT
SIA SSB
SECETI
BANKA SLOVENIJE
PBS
STEP2: SEPA HUB
14 Technical Facilitators
in 12 Countries

5. Recent and ongoing developments
Launch of STEP2 SCT Service on 28th January 2008
Payments Ahead of Value Date (Warehousing), STP Returns,
ISO XML messaging
Implementation of M-PEDD Phase 1:
STEP2 SDD Service: Ready to use–in Test & Training
Introduction of a Same Day Processing Cycle on 5th May 2008
SEEBACH – Development of Multilateral Netting Module (MNM)
Settlement of STEP2 SCT Service in TARGET2: on 8th December 2008
Multilateral Net Balances
Two Settlement cycles on D – 07:30 & 14:00
Supporting Settlement of Bilateral Clearing
Introduction of a Night-Time Settlement Window for STEP2 SCT
Settlement on D at 01:30 CET

6. SEPA and PE-ACH The Luxembourg migration
Serge Wagener, Banque et Caisse d’Epargne de l’ Etat, Luxembourg 6

7. The Luxembourg SEPA migration (1)
September 2002
Introduction of IBAN for domestic usage
July 2003
BCEE is first bank in Luxembourg to participate in STEP2 XCT, and offering Entry Point services
Reachability is assured
October 2005
IBAN becomes mandatory for domestic credit transfers
all domestic transfers are SEPA-compliant
Decision taken to migrate domestic payments to STEP2 XCT 7

8. The Luxembourg SEPA migration (2)
October 2006
Shut down of local ACH, LipsNet
January – February 2008
Technical migration from STEP2 XCT to SCT
Today:
67% of incoming payments via SCT
82% of outgoing payments via SCT
 Returns
 Reachability 8

9. The Luxembourg SEPA migration (3)
The best choice in 2006: does it remain a good choice in the medium and
long term?
2010 deadline challenged by a number of banking communities
The discussion is on-going 
Commitment from other banking communities to move to a pan-European infrastructure?
Trend is positive 
Uncertainty about how the future European infrastructure for retail payments will develop
The landscape is changing 
Uncertainty about future costs
The business case is positive, for credit transfers 

10. SEPA and PE-ACH Evolving service requirements
Thomas Egner, Commerzbank 10

11. Evolving service requirements – where do we come from?
XCT as a pre-SEPA service
Successful provisioning and start of the new SEPA SCT Service (SDD to follow), i.e.:
Implementation of core payment scheme
Implementation of defined processes
In time, in money
Significant REACH provided to the users
Providing service for all market parties, i.e. Financial Institutions (DP and IP) plus CSMs
Attractive pricing policy
(Re-)Use of already existing technology
Robust and reliant system
Separate product/scheme/service on existing platform
Use of well-functioning clearing and settlement service 11

12. Evolving service requirements – where should we go?
Chase for volume, i.e. national transactions, new business fields, e.g. opening the platform for other services/schemes such as cards
Building components around existing schemes, resulting in a better service without changing schemes, i.e. more settlement cycles
Low profile service vs. full service offering with an individual choosable service structure (by flexible bundling)
Overall attractive pricing offering
Support of nationally/user group defined AOS

13. Future developments STEP2 SCT Service enhancements
EPC Rule Book changes v 3.2 & User enhancements – 2nd February 2009
STEP2 SDD Service enhancements
EPC Rule Book changes v 3.1 & User enhancements – 2nd November 2009
M-PEDD phase 2
Implementation & launch of a STEP2 B2B Debit Service – 2nd November 2009
Evolution of STEP2 Interactice Workstation Services
Risk mitigation, e-mandates,
Development of file-based service for other euro payments
Multi-currency processing service
Card Settlement
E-invoicing
The full up-to-date picture of the situation in terms of reach across SEPA of banks that have signed the EPC SCT Adherence Agreement. Currently, STEP2 SCT reaches 93 percent of the adhering banks and the number continues to grow. An impressive picture after these few months of operations.
[NB: Italy looks so white because currently only about 34% of the institutions having signed the EPC SCT AA are covered by STEP2 – this will dramatically change with the connection of ICCREA]
However, there are still about 300 banks that have signed the Adherence Agreement but are still missing in our routing tables...