HSBC Your Guide to SEPA. Capitalising on the opportunities

Transcription

1 HSBC Your Guide to SEPA Capitalising on the opportunities

2 Executive Summary Developed by the European Payments Council, the Single Euro Payments Area or SEPA expands on the vision behind the Euro to establish a single monetary and economic union. Specifically, SEPA is geared toward creating a border-less system of Euro payments throughout the 34 SEPA countries by putting a consistent set of standards, rules and conditions in place. The ultimate goal is to make sending and receiving SEPA payments as easy and cost effective as non-urgent domestic ACH transactions have been traditionally. This objective has also been facilitated by the implementa tion of the EU Payment Services Directive in 2009, which established the legal foundation for SEPA. The mandatory deadline for all legacy Euro transactions within the Eurozone to migrate to harmonised SEPA schemes for both Credit Transfers and Direct Debits was 1 February 2014 (SEPA End Date) with an additional transition period of up to six months.* As a second step, Euro transactions in non-euro SEPA countries are also required to be SEPA compliant by 31 October While many businesses have been focussing on compliance, making the move to SEPA is bringing with it a number of benefits. SEPA affords companies the opportunity to re-engineer their bank account and liquidity management structures in a way that will greatly simplify processes, and which can be easily used by Payment Factories or Shared Service Centres. The increased standardisation required by SEPA saves time and money as it effectively reduces the number of accounts and payment systems that need to be managed and maintained. Consolidating bank accounts will help create a centralised source of funding to improve overall cash management. Companies may also find they are able to expand into new European markets as the need to deal with individual local payment systems and procedures is eliminated We have created Your Guide to SEPA to provide you with concise, expert knowledge on the key SEPA characteristics and benefits of harnessing the full potential of SEPA and ISO XML. In the pages that follow, you will benefit from the experience we have gained as we ve helped a number of companies across the entire SEPA zone transition from their legacy systems to SEPA and assisted in capitalising on the SEPA opportunities. * For more information on the expected impact of the proposed transition period, please refer to the SMART (SEPA Migration Action Round Table) website: ** For more details on what constitutes a derogation, please refer to the ECB website: Please note that HSBC is not responsible for third party websites.

3 Contents 1 1. The Purpose of SEPA 3 2. SEPA End Date Regulation 4 3. XML A Global Standard Format 5 4. SEPA Credit Transfer 5 a. What You Need to Know 6 5. SEPA Direct Debit 6 a. How SEPA Direct Debit Works 7 b. What You Need to Know 9 c. The SEPA Direct Debit Mandate 13 d. Pre notification 13 e. Submission or Notice Periods 14 f. Refund Periods 14 g. Revocations, Requests for Cancellation and Reversals SEPA Benefits Why HSBC 18 Appendices 18 Appendix A: Sample SEPA Direct Debit Mandate 20 Appendix B: Useful Links 21 Contact

4 1. The Purpose of SEPA In addition to the 28 member states of the European Union (EU), SEPA also includes Iceland, Liechtenstein, Monaco, Norway, San Marino and Switzerland. While the national payment systems used by these countries were efficient on their own, they were not consistent and, therefore, not compatible with one another. This made cross-border transactions complex, costly and often cumbersome even though they were denominated in the same currency. SEPA has eliminated these issues. By implementing SEPA Credit Transfer and SEPA Direct Debit, cross-border euro transactions within the SEPA zone became just as secure, cost effective and simple as domestic transactions. With the adoption of SEPA, there is no longer any distinction between national and cross-border payments. 1

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6 2. SEPA End Date Regulation From 1 February 2014: The SEPA End Date was 1 February However, the European Commission, Parliament and Council endorsed an additional transition period which permitted the processing of non-sepa compliant payments (legacy payments) alongside SEPA Credit Transfers and SEPA Direct Debit transactions for a period of up to six months after the SEPA End Date. After the Transition Period: The existing national Euro Automated Clearing House (ACH) payment schemes in the Eurozone were demised for legacy Credit Transfer and Direct Debit transactions. The use of the SEPA Credit Transfer and SEPA Direct Debit schemes, as well as ISO XML formats became mandatory. For making domestic payments and receiving domestic Direct Debits, IBAN details are required, but depending on country-specific derogation, BIC details may be required up to 1 February For cross-border transactions, both BIC and IBAN are required, where BIC is mandatory until 1 February From 1 February 2016: All transactions will include IBANs only the BIC will no longer be required (optional). The transitional regulation for the niche products expires. An Overview of the SEPA Transaction Requirements SEPA covers transactions in the euro currency only. IBANs and BICs are the only permitted account identifiers for all SEPA transactions. Whereas in the past most countries used these identifiers for cross-border payments, under the SEPA scheme they are also required for domestic payments. Previous national Euro credit transfers are replaced by SEPA Credit Transfers. The SEPA Direct Debit scheme replaces legacy Euro direct debits schemes in SEPA countries. Certain niche products, as announced by each member state, will not migrate to SEPA schemes and processes until 1 February When processing SEPA transactions, ISO XML formats must be used in place of legacy local formats for data exchange. The following binding specification is also set out in the SEPA regulations: Banks are required to offer their customers mechanisms for monitoring and safeguarding accounts against unauthorised incoming direct debits based on the amount, frequency of the direct debit and/or creditor ID. From 31 October 2016: Euro-denominated payments in non-euro member countries are required to transition to SEPA schemes and processes. 3

7 3. ISO XML A Global ISO Standard Format XML stands for Extensible Markup Language. It is an international standard for modelling data, and is administered by the World Wide Web Consortium (w3c). In order to use the XML format efficiently in the financial world, the International Organisation for Standardisation (ISO) has introduced ISO standard The data formats of the SEPA Rulebook are based on this standard. ISO XML is mandatory for the exchange of SEPA payments between banks. However, it is expected that under certain conditions, such as country derogations, banks will continue to be able to accept other formats for payment instructions from their customers. Since the ISO XML format is an international standard, it is supported by IT systems around the world. With this, it is anticipated that ISO XML will be used in other payment transfer procedures in the future, such as foreign currency payments, in addition to the SEPA process. For more specific information on ISO XML, visit and 4

8 4. SEPA Credit Transfer SEPA Credit Transfer is similar to the current EU standard Credit Transfer, which has been in use since The difference, however, is that the SEPA Credit Transfer can be used for both cross-border and domestic euro payments in SEPA member countries. a. What You Need to Know The transfer amount must be credited to the beneficiary account in full. The SEPA Credit Transfer is a SHARE payment, and as such each side bears its own fees and is charged separately. SEPA Credit Transfer takes a maximum of one business day. There are no limits on the amount for SEPA Credit Transfers. The length of the remittance information for each SEPA Credit Transfer allows up to 140 characters. The Originator s reference identifies for a given Originator each Credit Transfer Transaction presented to the Originator Bank, in a unique way. Work flow SEPA Credit Transfer Originator Underlying transaction Beneficiary 5. a) Originator information (bank statement) 1. Initiation (D) 4. Beneficiary entry (D+1) 5. b) Beneficiary information (bank statement) Originator Bank 2. Settlement (latest D+1) Beneficiary Bank 3. Clearing and settlement mechanism 5

9 5. SEPA Direct Debit Being the first cross-border and national direct debit scheme established, SEPA Direct Debit is based on two respective rulebooks of the European Payments Council: the SEPA Direct Debit Core Rulebook and the SEPA Direct Debit B2B Rulebook. a. How SEPA Direct Debit Works The processing of a direct debit begins with, and is initiated by, the Creditor, who would like to collect a claim from an underlying transaction in its favour. The Debtor, who is the payer of this transaction, must authorise the debit from the Debtor s account via a signed SEPA mandate. The Creditor submits the direct debit transaction through its bank and the Creditor s bank in turn submits it to the Debtor s bank. Each transaction is given a firm, binding due date referred to as the D, value date or settlement date. It is on this date that the Debtor account is debited. If the due date falls on a non-business day, the account is debited on the next business day. The Debtor and Creditor are subsequently informed of the debit and the credit respectively, for example on an account statement. 6

10 b. What You Need to Know There are two versions of the SEPA Direct Debit scheme: SEPA Direct Debit Core (SDD Core) scheme, which is available to both corporates and consumers includes the COR1 variant (SDD COR1) which allows a shorter submission period (D-1 SEPA Direct Debit Business to Business (SDD B2B) scheme, which is used strictly between corporates. When a collection agreement is established, the Debtor and Creditor can decide which scheme is applicable and which they prefer to use. The fundamental difference between the SDD Core and SDD B2B schemes lies in the finality of the payment. In the SDD Core scheme, Debtors can request refunds on authorised collections for up to eight weeks after the debit has been made. In the SDD B2B scheme, refunds are not permitted. However, to ensure Debtors are protected against unauthorised direct debits, the Debtor s bank is required to check the direct debit against the mandates provided prior to payment. With SDD Core, SDD COR1 and SDD B2B the Debtor s bank can also offer additional options for added protection against unauthorised electronic debits. For example, Debtors can choose to accept or reject certain debits from posting to their accounts based on specific creditor IDs or mandate references. The SDD COR1 is an optional time cycle of the SDD CORE scheme and may be agreed between the Debtor Bank and the Creditor Bank (or within a community of banks). If the reduced time cycle is used, the type of the service transaction has to be indicated in the SEPA Direct Debit collection. Some banks in Non-Eurozone may not be reachable for SEPA Direct Debits. Euro Clearing in Non-Eurozone countries should close 31 October The SDD B2B and SDD COR1 remain voluntary for all banks. The SEPA Direct Debit scheme includes the following components: The direct debit collection is authorised using a formalised mandate. The direct debit Creditor has an obligation to inform Debtors of the due date and amount in the form of a timely pre-notification. The mandate reference and creditor ID must be communicated with every direct debit transaction. There are also strict regulations for transaction processing and the handling of R-transactions, such as rejects and returns. The length of the remittance information for each SEPA Direct Debit allows up to 140 characters. 7

11 Work flow SEPA Direct Debit 1. Signed SEPA mandate Debtor Creditor 2. Pre-notification (D-14 or as agreed) 0. Terms and Conditions of Accounts 7. a) Direct debit advice / statement entry 3. Initiation*) Core: D-5/D-2 B2B: D-1 7. b) Credit entry 0. Contract 5. B2B: Mandate check 4. Presentation*) Core: D-5/D-2 B2B: D-1 Debtor Bank Creditor Bank 6. Settlement (D) * The SDD Core Rulebook allow a voluntary submission of just one day prior to the due date (D-1) COR1. However, this is only possible if the debtor bank also agrees to it. 8

12 c. The SEPA Direct Debit Mandate In order to collect funds via a SEPA Direct Debit, the Creditor must have the Debtor s authorisation to debit the account in the form of a mandate. The mandate is sent from the Creditor to the Debtor The Debtor signs the mandate and sends it back The content of the mandate is standardised based on SEPA regulations; the fields and their order are pre-defined The mandate may be an individual document or part of a contract. If it is part of a document, it must be clearly separated from the rest of the content The Debtor can cancel the mandate at any time; if the Debtor does not cancel the mandate, it automatically expires 36 months after the last collected direct debit The Creditor should check the validity of the mandate in advance of submitting a SEPA Direct Debit. Using an invalid mandate would lead to an unauthorised direct debit The mandate can be used for transactions across national borders The mandate must be written in the language of the Debtor s home country or in English if the Creditor cannot precisely determine the language required to issue the mandate Storage of the Mandate The Creditor is responsible for maintaining the mandate, as well as its history. The Creditor must be able to present a copy of the mandate to the Debtor s bank upon request. If the Creditor is not able to do so, a refund and compensation will be required if the Debtor objects to the debit. Please note, although the Creditor has the obligation to provide a copy of the mandate on request, if the legacy Direct Debit scheme allowed non paper-based mandates, or if the legacy mandate is held by the Debtor s bank, this obligation will not apply. Content of the Mandate An explicit instruction to the Debtor s bank to debit the respective account Creditor ID and unique mandate reference, both of which must be clearly conveyed on each direct debit The designation as SEPA Direct Debit Core mandate or SEPA Direct Debit B2B mandate Execution frequency (one-off or recurrent payment) Name and address of the Creditor Name and address of the Debtor IBAN and BIC of the Debtor Date and signature of the Debtor Please refer to the Appendix A for a sample SEPA Direct Debit mandate. 9

13 Mandate flow for SEPA Core Direct Debit 2. Sends signed mandate back to creditor (Debtor is advised to keep a copy) Debtor Creditor 1. Sends mandate to debtor 3. Captures mandate data 4. Stores mandate Debtor Bank Creditor Bank Mandate flow for SEPA B2B Direct Debit 2. a) Sends signed mandate back to creditor 2. b) Where required by the Debtor Bank sends a copy of signed mandate to debtor bank* 2. c) Keeps a third copy for record Debtor Creditor 1. Sends two copies of the mandate to debtor 3. Captures mandate data (e. g. in ERP system) 5. Stores mandate Debtor Bank Creditor Bank 4. Stores mandate data 6. Checks collections against mandate data *Please note that this requirement may vary by Debtor bank. 10

14 Mandate Migration In conformity with the European regulation, existing legacy mandates could be used in all SEPA countries for collections in the SDD Core scheme. However, new SEPA mandates are required for all SDD B2B collections. Mandate Reference Every SEPA Direct Debit mandate must have a unique mandate reference, also referred to as a mandate ID or UMR. This reference is assigned by the Creditor and enables the Debtor to clearly identify the mandate in connection with the creditor ID. The Debtor can therefore automatically check whether incoming direct debits are permitted. When assigning the mandate reference, using existing customer or contract numbers, expanded by one number or date value, is typically the easiest. A mandate reference can be up to 35 characters long, and include any combination of the following: A Z a z 0 9 +?/ \ : ( )., Blank spaces For new SEPA Direct Debit mandate, it is recommended that the unique mandate reference is included in the mandate itself. However, this is not required as long as the mandate reference is communicated to the Debtor before the first SEPA Direct Debit collection. Please note that SDD B2B collections can only be executed after the unique mandate reference has been communicated to the Debtor and the Debtor has conveyed this unique mandate reference to his Debtor bank (obligatory mandate verification by the Debtor s bank). Creditor Reference/Creditor ID The creditor identification number, or creditor ID, is a new attribute required for SEPA Direct Debit transactions. All legal entities who want to submit SEPA Direct Debits for collections must apply for a creditor ID. While this process varies from country to country, Creditors will generally apply for and receive their creditor ID in the country their headquarters are located. The creditor ID can be used for any accounts of the same legal entity in all SEPA countries. For example, if a creditor ID is obtained in France, it can also be used for SEPA collections from one of the Creditor s accounts in Belgium. Additionally, if the creditor ID has been obtained from a specific bank, it remains valid even if the Creditor changes banks and no longer has a relationship with the original bank. The mandate reference must be unique for each Mandate in combination with the identifier of the Creditor (without the extension, called Creditor Business Code). The Debtor s bank uses the creditor ID in combination with the unique mandate reference to perform mandate verification before the Debtor s account is debited, which is required in the SDD B2B scheme. For the SDD Core scheme, the Debtor undertakes verification and has 13 months to object if the transaction was unauthorised. The creditor ID has a general structure throughout SEPA and can be up to 35 digits long. If needed, HSBC can provide support in helping you obtain a creditor ID. 11

15 The creditor ID has a standard form throughout SEPA and can be up to 35 characters long. HSBC in the UK uses a 34 digit long creditor ID which is structured as follows: Structure of the creditor ID: GB 12 zzz SDDMIDL ISO country code Check digit Creditor Business Code National identifier Source: European Payments Council 12

16 Date of the Mandate The date of the mandate is required information for every SEPA Direct Debit. When new mandates are received, the actual date of the mandate should be used. Changes impacting the SEPA Mandate When a Creditor moves an account to a different country or changes Creditor Bank, there is no need to issue a new SEPA mandate, amend the existing mandate or advise the clients of changes to the Creditor s Bank or Creditor s account. However, if the Creditor name and/or Creditor ID changes, the existing SEPA mandate should be amended. Additionally, if the Legal entity changes, a new SEPA mandate will be required. d. Pre-notification Creditors must inform their Debtors of a planned SDD Core debit prior to the collection. This pre-notification must be sent at least 14 days before the due date, unless the Creditor and Debtor have previously agreed to a shorter timeframe. Pre-notification can be included as part of other documentation, such as an invoice. The aim of the pre-notification is to keep the number of direct debit returns due to insufficient account funds, for example, to a minimum. Each pre-notification must contain the following information: Amount Due date Creditor ID Unique mandate reference What Else You Should Know about Pre-notification It is not possible to contractually agree to waive prenotification. The Creditor s bank and Debtor s bank are not required to check whether a pre-notification exists, as this only affects the contractual relationship between the Creditor and the Debtor. Failure to provide a pre-notification does not mean that the direct debit is unauthorised. The method of delivery for the pre-notification is not specified. Possible delivery methods include letter, fax, text messages, or a telephone call. Under certain conditions, the pre-notification can be incorporated into a contract. For recurring direct debits of the same amount, such as for instalment plans, informing the Debtor once before the first direct debit collection while indicating the future due dates is sufficient. A new pre-notification is only necessary if the amount or frequency changes. e. Submission or Notice Periods Under SEPA Direct Debit schemes, there are four collection types that determine the submission or notice period of a transaction. One-off a stand-alone collection that is not a part of a series First the first collection in a series of recurrent direct debits Recurrent collections in a series subsequent to the first Last the final collection in a series of recurrent direct debits 13

17 For the SDD Core Scheme The Creditor communicates the first or one-off direct debits via the Creditor s bank to the Debtor s bank at least five business days before the due date (D-5). Subsequent direct debits (recurrent and last) must be communicated by the Creditor to the Creditor s bank onto the Debtor s bank at least two business days before the due date (D-2). Data submission by the Creditor on D-5 or D-2 is subject to customer cut-off time requirements. To ensure the due date for transactions, we may recommend files be submitted to HSBC earlier on the previous day, i.e. six business days before for first or one-off direct debits (D-6), and three business days before for subsequent direct debits (D-3). Returns by the Debtor s bank (e.g. in the event of insufficient funds in the Debtor s account, refusal by the Debtor, etc.) must be made within five business days after the due date of the original SDD Core. For the SDD COR1 variant Collections with all sequence types are presented to participating banks one business day before the due date (D-1). File submissions by the Creditor on D-1 are subject to the customer cut-off time requirements. All other features and rules are as for the Core scheme. If the reduced time cycle is used, the type of the service transaction has to be indicated in the SDD collection. For the SDD B2B Scheme For all sequence types, the direct debits are communicated by the Creditor to the Creditor s bank onto the Debtor s bank to the clearing centre for settlement one business day before the due date (D-1). File submissions by the Creditor on D-1 are subject to the customer cut-off time requirements. The Debtor s bank can return the direct debit up to two business days after the due date. However, refunds are not possible. f. Refund Periods The Debtor is able to obtain a refund of an authorised SDD Core transaction up to eight weeks after the debit date. For SDD B2B, the Debtor s bank checks the direct debit against the mandates provided before the payment is made. As a result, the Debtor is not able to object and no refunds are possible. In either direct debit scheme, if no mandate or no valid mandate exists, the Debtor can object up to 13 months after the debit. g. Revocations, Requests for Cancellation and Reversals Creditors can request for revocation or cancellation of a SEPA Direct Debit collection or batch prior to settlement. Creditors can also reverse their transaction(s) up to 5 business days after the due date. 14

18 Comparison of periods for Core and B2B schemes SEPA Core Direct Debit (including COR1 variant) D: Due date = debtor s debit date = inter-bank settlement date D-14 CD: Customer pre-notification of amount and due date (unless other timeframe is agreed) D-5 BD: Submission of first or one-off SDD SEPA B2B Direct Debit D: Due date = debtor s debit date = inter-bank settlement date D-14 CD: Customer pre-notification of amount and due date (unless other timeframe is agreed) D-1 BD: Submission of first, one-off, recurrent and last SDD D-2 BD: Submission of recurrent or last SDD D-1 BD: SDD COR1 variant: Submission of first, one-off, recurrent and last SDD D+5 BD: Latest date for bank returns D+2 BD: Latest date for bank returns D+8 W: Maximum refund period for debtor for authorised transactions D+13 M: Maximum refund period for debtor for unauthorised transactions D+13: No refund right for debtor Maximum refund period for debtor for unauthorized transactions (exceptional) D+36 M: Mandate expires 36 months after last SDD Submission D+36 M: Mandate expires 36 months after last SDD Submission CD = Calendar Days, BD = Business Days, W = Weeks, M = Months 15

19 6. SEPA Benefits SEPA within the legal framework of the Payments Service Directive provides for a boundaryless payments landscape throughout 34 countries. It has introduced standards with the ISO XML that puts all stakeholders on the same playing field. SEPA and XML uplift provides an opportunity for companies doing business in Europe to re-visit their operations, organisations and account structures to allow for a better control of their liquidity and engage in cost savings as part of the treasury transformation. The decision to move from local treasuries to in country centralisation or regional centralisation, is a means to better managing resources far beyond payables and receivables, with Foreign Exchange management and Trade Finance. These initiatives will increase visibility and control, positively impacting working capital. Companies are no longer doing business in a fragmented payments landscape, but in a standardised payments landscape with a common message format, a common ACH clearing system and harmonised clearing cycles. The standardisations of SEPA and the use of the ISO XML format across the region and beyond facilitate end-to-end transparency, enhance automated reconciliation rates and reduce manual intervention. This generally entails the optimisation of technology through a single instance of an ERP/TMS systems and the appropriate bank connectivity, either proprietary or multibank, such as SWIFT. Payables and receivables can be centralised into fewer accounts, after review of existing payment types, entailing rationalisation of accounts, but equally a better control and visibility of the transaction flows. The ISO XML format allows for payments on behalf of (PoBo) and collections on behalf of (CoBo), which naturally integrates itself into centralized payments or collections. Optimisation can further be achieved through a Collection or a Payment Factory, Shared Service Centre or In house Bank. Our teams can provide you with the right level of consultancy and further insights about challenges to centralisation, such as niche products, market practices or local restrictions. To capitalise on centralisation and rationalisation, you will also need to ensure that you have carried out the necessary due diligence. A treasurer can further leverage his treasury transformation through appropriate cash and liquidity management, hence no issues with missed sweeps, pockets of cash left overnight or unforeseen charges. 16

20 7. Why HSBC HSBC has made a significant investment in SEPA compliant payment systems, and has an extensive ISO XML offering that covers all the countries in the SEPA zone as well as others around the world. This is combined with a network of offices across Europe with extensive payments capabilities giving us the ability to provide a coordinated delivery of SEPA compliant transactions. When you choose HSBC, you will have access to a dedicated team of SEPA experts who will work with you through SEPA implementation at the country, regional and global level to: Keep you informed on the latestsepa market news and talk to you about what this means for your business Advise you on technical and strategic aspects of SEPA End Date Regulation, including how best to go about implementing ISO XML Help manage and centralise payments from many locations across Europe, assisting you in your rationalisation and treasury transformation project. Provide you with insights about niche products, market practices or local restrictions to be taken into account when rationalising. In addition to this, HSBC is among industry pioneers that are adopting the ISO XML messaging in standard formats to allow clients to integrate core treasury, payables and receivables applications to share with banking and other financial partners. If you have any questions, please refer to or contact your HSBC representative. Our SEPA specialists will be happy to speak to you and provide you guidance to help you through the SEPA integration. 17

21 Appendix A: Sample SEPA Direct Debit Mandate 18

22 SEPA Direct Debit Mandate Mandate reference to be completed by the creditor CREDITOR S NAME & LOGO By signing this mandate form, you authorise (A) {NAME OF CREDITOR} to send instructions to your bank to debit your account and (B) your bank to debit your account in accordance with the instructions from {NAME OF CREDITOR}. As part of your rights, you are entitled to a refund from your bank under the terms and conditions of your agreement with your bank. A refund must be claimed within 8 weeks starting from the date on which your account was debited. Your rights are explained in a statement that you can obtain from your bank.please complete all the fields marked *. * Your Name 1 Your name Name of the debtor(s) Your address Your address Your account number Your account number Creditor s name * 7 Your name Creditor name Creditor name ** 8 Creditor Identifier Creditor Identifier ** 9 Street name and number Street name and number ** 10 Postal code City Postal code City ** 11 Country Country Type of payment Type of payment Name of debtor(s) * Street name and number Street name and number * Postal code Postal code * Country Country * Account number IBAN Account number IBAN * SWIFT BIC * Recurrent payment Recurrent payment or or City City 6 One-off payment One-off payment City or town in which you are signing City or town in which you are signing Location Location Date * Date D D M M Y Y 13 Please sign here Signature(s) Signatures * Note: Your rights regarding the above mandate are explained in a statement that you can obtain from your bank. Note: Your rights regarding the above mandate are explained in a statement that you can obtain from your bank. Details regarding the underlying relationship between the Creditor and the Debtor for information purposes only. Details regarding the underlying relationship between the Creditor and the Debtor for information purposes only. Debtor identification code 14 Debtor identification code Write any code number here which you wish to have quoted by your bank. Write any code number here which you wish to have quoted by your bank. Person on whose behalf 15 Name of the Debtor Reference Party: If you are making a payment in respect of an payment is made arrangement between {NAME OF CREDITOR} and another person (e.g. where you are paying the other person's bill) please write the other person's name here. If you are paying on your own behalf, leave blank. Person on whose behalf Name of the Debtor Reference Party: If you are making a payment in respect of an payment is made arrangement between {NAME OF CREDITOR} and another person (e.g. where you are paying the other person's bill) please write the other person's name here. If you are paying on your own behalf, leave blank. 16 Identification code of the Debtor Reference Party Identification code of the Debtor Reference Party 17 In respect of the contract In respect of the contract: Name of the Creditor Reference Party: Creditor must complete this section if collecting payment on behalf of another party. Name of the Creditor Reference Party: Creditor must complete this section if collecting payment on behalf of another party. Identification code of the Creditor Reference Party Identification code of the Creditor Reference Party Identification number of the underlying contract Identification number of the underlying contract Description of contract Description of contract Please return to: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX Creditor s use only XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX 19

23 Appendix B: Useful links Further information on the web HSBC HSBC SEPA website European Payments Council Decision-making and coordinating body of the European banking industry European Payments Council Introduction to SEPA European Payments Council International Mandate Translations SEPA DD Core European Payments Council International Mandate Translations SEPA DD B2B ISO universal financial industry message scheme Learn more about ISO CGI Information regarding the initiative Common Global Implementation European Commission Information on the necessary legal framework for SEPA EBA Clearing Information on EBA clearing European Central Bank SEPA information website SMART SEPA Migration Action Round Table URL cfm?tid=4 cfm?page=core_sdd_mandate_transalations cfm?page=sepa_b2b_dd_mandate_translations index_en.htm

24 Contact To find out more about SEPA visit our website or speak with your HSBC representative. Features and functionality may vary by country. Please confirm availability with your local HSBC Representative. HSBC Bank endeavours to ensure that the information in this document is correct and does not accept any liability for error or omission. You are solely responsible for making your own independent appraisal of and investigations into the products and services referred to in this document and you should not rely on any information in this document as constituting investment advice. This document does not constitute any form of legal, tax or account advice from HSBC Bank plc to you. HSBC Bank is not responsible for the content of third party websites. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, on any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of HSBC Bank plc. Issued by HSBC Bank plc. We are a principal member of the HSBC Group, one of the world s largest banking and financial services organisations with around 6,200 offices in 74 countries and territories. HSBC Bank plc, Customer Information: PO Box 6201, Coventry CV3 9HW. HSBC Bank plc Registered Office: 8 Canada Square, London E14 5HQ Registered in England Number Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority AC31327 HSBC Bank plc All Rights Reserved. 21