Paris and Vienna, 15 September 2008

STEP2 SCT to offer night-time settlement from December 2008

EBA CLEARING starts testing of STEP2 SCT settlement in TARGET2 on multilateral net basis

EBA CLEARING announced today that its PE-ACH platform STEP2 will be the first Clearing and Settlement Mechanism to offer its users night-time settlement of SEPA payments in TARGET2. TARGET2 acceptance testing of the new settlement model starts on 24th September 2008. Participants in the STEP2 SEPA Credit Transfer (SCT) Service will be able to take advantage of the optional night-time processing and settlement cycle from 8th December 2008 on. The new cycle is open for sending from 13:00 CET on D-1 to 01:00 on D with settlement taking place at 01:30 and output file delivery starting at 02:00.

“With the implementation of a night-time cycle for the STEP2 SEPA Services, we respond to our users’ requirement for STEP2 file delivery in the early hours of the morning,” said José Beltrán, Director of STEP2 Services at EBA CLEARING. “The new cycle facilitates early application of funds to customer accounts and, at the same time, ensures that the secure principle of settlement before delivery of files is maintained.” 

The introduction of a night-time processing cycle with settlement in TARGET2 has been made possible by the implementation of a new Multilateral Netting Module (MNM), which will serve as an interface between the STEP2 platform and the TARGET2 Ancillary System Interface (ASI). The MNM was developed by EBA CLEARING in co-operation with SWIFT in order to facilitate the exchange of SEPA Credit Transfer – and later also SEPA Direct Debit – settlement transactions between the two systems and to derive net settlement amounts from the individual bilateral gross obligations generated by the STEP2 platform.

The new settlement model in TARGET2 will also be applied to the morning and afternoon cycles currently in place for the STEP2 SCT Service. While the two day-time cycles will settle through ASI4, the settlement of the night-time cycle will take place via ASI6. By offering settlement of its STEP2 SEPA Services in TARGET2 on a multilateral net basis, EBA CLEARING prepares its Pan-European ACH for the growing volumes to be processed via the SEPA instruments by a larger user base in the upcoming years. The new settlement solution provides greater efficiency of liquidity and more flexibility to existing users as well as open access to the wider community of institutions wishing to be connected to the STEP2 SEPA Services.

Besides responding to key business requirements of the STEP2 SCT Participants, the new enhancements will also ensure that STEP2 SCT will comply ahead of the time with the major additional requirements of version 3.2 of the SCT Scheme Rulebook, which will become applicable on 2nd February 2009.