EBA Clearing reveals seven German banks will use the Step2 payments system to process and clear their domestic payments, converting in the second half of 2013.
A group of seven German banks today announced they are adopting EBA Clearing’s Step2 system to process their low-value, bulk domestic payments, as part of their compliance with the forthcoming Single Euro Payments Area (Sepa).
Step2 is an automated clearing house used for processing credit transfers and direct debits that are conducted in euros, and is a "central component" of the Sepa infrastructure.
The seven German banks are already using Step2 for some cross-border transactions, and will begin using it for domestic payments from the second half of the year. Currently, the banks clear transactions through direct exchanges with one another, in a system called ‘Garagenclearing’.
Commerzbank, Deutsche Bank, Deutsche Postbank, DZ Bank, Helaba, HypoVereinsbank (a member of UniCredit) and Landesbank Baden-Württemberg have agreed to adopt Step2, while EBA clearing has suggested that others could follow.
Gilbert Lichter, EBA Clearing chief executive, said the changeover process has begun and that he expects "a successful migration over the coming months".
Christian Rhino, a divisional board member at Commerzbank, highlighted the benefits of channelling the bank’s retail transactions through a single clearing system. "Concentrating our mass payments on one central platform allows us to minimise our administrative and monitoring efforts and to improve our liquidity management in this area," he said.
Financial institutions in the European Union must migrate to payment systems compliant with Sepa regulations by February 1, 2014. Consequently, EBA Clearing said it is "implementing the final Step2 functionality enhancements".
This includes a third processing site to help equip Step2 with the "operational robustness" necessary to cope with the settlement of higher volumes of transactions and future regulatory requirements.
Moreover, and to cater to the increased German use, EBA Clearing will establish a German-language customer support service in its Frankfurt office.
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