The Italian infrastructure for clearing and settlement of retail payments, which is operated by Banca d'Italia and Istituto Centrale delle Banche Popolari Italiane (ICBPI), is launching a collaboration with VocaLink to establish a link for the exchange of SEPA payments based on the European Automated Clearing House Association (EACHA) interoperability standards. It is expected that customers of the two Clearing and Settlement Mechanisms (CSMs) will thus be able to count on a way of achieving mutual reach across the single euro payments area (SEPA) region, with no need for participation in the reachable CSM; what used to be known as the PE-ACH (pan-European account clearing house).

The provision of reciprocal interconnection services between the CSMs managed by VocaLink and ICBPI/Banca d'Italia, allowing them to mutually exchange (and settle in TARGET2) SEPA-compliant payments on behalf of their respective banking communities, will contribute to the single euro payments area aim of developing a fully integrated and competitive retail market with no differences between national and cross-border payments. The interoperability model has been talked about for many years but this is an instance of it coming into being, with former national infrastructure payments processors co-operating to bring continent-wide service.

VocaLink and ICBPI/Banca d'Italia plan to enable their customers to execute SEPA Credit Transfers (SCTs) during the course of Q2 2010. Afterwards the CSMs will start assessing the extension of the interoperability agreement to SEPA Direct Debits (SDDs) as well.

Commenting on the move, Franco Passacantando, managing director for the central banking, markets and payment system area, at Banca d'Italia, said: "The planned interoperability of the Italian clearing system with the UK's VocaLink Euro CSM represents a further initiative taken by Banca d'Italia to fully support the SEPA, also by means of direct provision of services. It is a necessary step towards the integration of the single European market for retail payments."

Giacinto Cosenza, the Italian country manager at VocaLink, added: "We are delighted to be working with the Italian infrastructures in this strategically important market. This is a major milestone on the path to deliver VocaLink's SEPA solutions to the Italian market, while further growing our CSM reach in continental Europe."

In conclusion Giuseppe Capponcelli, general manager at ICBPI, commented: "SEPA brings unique challenges for European banks and corporates. ICBPI's involvement in an interoperability arrangement with VocaLink will allow us to provide additional services to banks working with either party."

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