STEP2, a truly pan-European payment infrastructure solution
STEP2 has been conceived from the outset as a Pan-European Automated Clearing House for the single currency and eventually for a Single Euro Payments Area (SEPA), where banks from the different SEPA countries connect directly to exchange payment files and where appropriate routing tables enable reach to all other banks offering SEPA payments. Creating reach through this concept has proven to be a most efficient way for payment service providers (PSPs) to route their payments all over Europe and an effective integration factor for the European payments markets.
Today, over 130 participants are directly connected to the STEP2 platform to exchange and settle SCT or SDD files every day. On the STEP2 routing tables, there are today more than 4,800 PSPs from all over SEPA. Since the launch of SEPA, EBA CLEARING has endeavoured that all Scheme-adhering PSPs are listed in the routing table(s) of the respective STEP2 SEPA Service(s), so that all other PSPs know how to reach them.
How STEP2 ensures reachability
STEP2 and 15 other SEPA CSMs have established interoperability, which facilitates reach to around 20 percent of the 4,800+ reachable BICs listed in the STEP2 SCT routing table.
The EBA CLEARING reachability model enables banks to comply with their obligation to be reachable in SEPA. The model is based on:
- open access: any SEPA CSM can channel payments via STEP2 on behalf of its participants and designate a direct participant for settlement in TARGET2.
- central routing tables: all banks that can be addressed via the STEP2 SEPA Services are listed in the routing table(s) of the respective service(s), to show that they are reachable. Banks that are reachable through STEP2 Direct Participants are themselves neither direct nor indirect participants in the system.
- standard formats: the use of standard SEPA formats by all SEPA CSMs enables a seamless exchange of data between the infrastructures.
- direct exchange of files between the CSMs involved: CSMs that interoperate with STEP2 send and receive files of payments, validation reports, settlement information and reconciliation reports directly to/from STEP2 over one of the currently supported networks.
- settlement obligation for payment messages sent or received via STEP2 by other SEPA CSMs: the settlement obligation is assumed by financial institutions enabling the protections of payments under the Settlement Finality Directive.