Irish businesses are not prepared for the upcoming shift to SEPA (Single Euro Payment Area) as only 42 percent state they have yet to begin making the required changes to their accounting systems, according to a survey from the Irish Business and Employers Confederation.
The survey of 300 companies found some 50 percent were unaware of the changes SEPA will have on their current payment procedures, hampering the motivation to make the necessary changes as the deadline approaches early next year. Although advice and information on SEPA is widely available, the survey found only 31 percent of firms have discussed the required changes with their bank and only 22 percent have talked with their payment software provider.
“Completing the necessary changes to payments and accounting systems will take several months, so it is essential businesses act now to ensure they are able to process electronic payments come 1 February 2014,” says Reetta Suonperä, senior economist at IBEC.
While larger firms have made the most progress towards SEPA compliance, small and medium sized firms are still very far behind. The survey found only one-in-two small businesses (firms employing fewer than 50 people) have begun preparations, and slightly more than 40% of medium sized businesses (firms employing 50-249 people) have yet to consider SEPA compliance.
Irish businesses are not alone. In March, the European Central Bank announced its latest SEPA progress report found small and medium sized businesses across Europe are either unaware or have not yet considered moving towards SEPA compliance.
In the report, Benoît Cœuré, member of the executive board at the ECB, echoed the sentiments of Suonperä, stating, “Adapting to SEPA involves adjusting a lot of technical and business procedures over a limited period of time. Projects of this kind should not be left to the last moment. I hope that all stakeholders will take migration to SEPA Payment instruments as a top priority.”
SEPA compliance appears set for failure unless there is direct market intervention to help small-and-medium sized businesses beat the deadline. Authorities may consider delaying the deadline date as it appears out of reach.
Click here to read more from Finextra.