March 2008 edition

Table of contents

Editorial by Marcel Schuler, Head of Banking Products & Support, Credit Suisse

"TARGET2 continues to be developed autonomously"
The new single shared platform of the European central banks for euro payments has been operating since the fall of last year. The migration process to TARGET2 is under way and should be complete with the connection of the six remaining EU systems in May 2008. Dieter Becker, TARGET2 Project Manager at the European Central Bank, sums up the past and looks ahead in our interview.

SEPA’s smooth start
Above 4,000 financial institutions have the technology to process customer payments in euros according to the new Single Euro Payments Area rules. The SEPA Credit Transfer Scheme was also launched successfully in Switzerland and Liechtenstein.

The hidden processing savings SEPA may deliver
The costs of SEPA implementation have been variously estimated by consultants and research organisations at between EUR 8 to 13 billion. Without a clear business case SEPA is perceived by many banks as a mandated change which delivers little to the bottom line. The good news is that savings of more than EUR 11 billion will be expected.

Remittances – A payment service with lots of potential
Around 200 million immigrants transfer more than USD 250 billion worldwide per year to their families in their home countries. Switzerland is the third largest sender country for these remittance payments. In order to increase the efficiency of processing these cross-border transactions, the SWIFT Workers’ Remittances Advisory Group has developed a new set of rules.

UNIFI – The payment traffic standard of the future
The new international payment traffic standard increasingly gains significance with the SEPA introduction. A working group of the Payments Committee Switzerland is developing recommendations for the Swiss financial market based on UNIFI, to be completed by the end of 2008.

New message type for cover payments
International pressure to provide more transparency, particularly in payment traffic, is continually increasing. Currently, the question being discussed worldwide is how banking transactions based on cover payments can be processed without financial institutions being suspected of money laundering and financing terrorism.