SEPA rulebook digest for 2023: what to look for

Every year, the European Payments Council (EPC) updates their SEPA payment schemes rulebooks, which are the set of rules, practices, and standards to achieve interoperability for the provision and operation of the different SEPA payment instruments. These rules and their evolutions are compiled in rulebooks. And the 2023 update packs significant changes introduced by the migration to a new ISO 20022 version.

Payment expert and author of the number one book about SEPA Credit Transfer Jean-Paul Megue and BNP Paribas’ Head of Industry Engagement for Payments Francis De Roeck covered these changes during a webinar we hosted this December.

Migration to a new ISO 20022 version after 14 years

ISO 20022 is a standard for electronic data interchange between financial institutions. It covers financial information transferred between financial institutions, including payment transactions, securities trading and settlement information, credit and debit card transactions, and other financial information.

While little known to the general public, ISO 20022 is the backbone of most modern payment networks and schemes, including SEPA. In 2023, the EPC will migrate to a new version of ISO 20022 for the first time since 2009.

Starting November 2023, banks and payment service providers (PSPs) will have no choice but to use this new ISO 20022 version for interbank communications.

However, they are not obligated to use this new version for customer-to-bank and bank-to-customer communications. When such migrations happened in the past, banks and PSPs took several years to enforce the new ISO 20022 version of the messages they exchanged with their corporate customers.

It means that direct and indirect SEPA participants should start studying and planning the implementation of the EPC’s 2023 SEPA rulebooks immediately, while corporate customers can get in touch with their banks to know when the changes will impact them.