SEPA Deadline

Well, it’s the 3rd February, the first working day after the SEPA deadline and where are we with the migration? Seems that few have move onward, if at all, with articles sprouting on the ‘net discussing this situation.

Why? What made the transition so difficult?

First and foremost, one of the main issues is legacy software. Many companies make use of software which happily played along with plain bank accounts. Not to mention that some of this software was specifically tailored to work with particular banks. This required changing the software, sometimes drastically, to somehow support the new SEPA system. That is, if you were lucky to find the old vendor or whoever created the software in the first place.

The next problem is the IBANs themselves; there’s been little education on the subject. While these numbers or not really complex, they do require some time to get used to. Of course, it does pay off — knowing the validity of a 31-digit number just by looking at the first four digits helps quite a bit.

However, you don’t magically get IBANs out of the original mess of BBANs, bank names and branch codes. The good part is that we have various utilities for generating IBANs. The bad part? They are often incomplete, broken or for some banks, completely nonexistent.

So how’s the situation currently being handled? There are two approaches:

  • Asking clients to cite the IBAN from their bank
  • Passing a huge list of accounts to banks for manual conversion

Guess what? In both cases it takes weeks if not months to complete.

Having seen this mess in person, I decided to try helping out a little bit. Given my (limited) experience with IBANs and local banks, I have built up a simple web service for converting IBANs in seconds.

As to the SEPA Migration? Seems the EC decided to add six more months to the deadline. Will everyone make it till then? Well, I’d like to think the EC will not be extending the deadline anymore — mostly because it is already reflecting badly on the EU economy as it is.