Albany Software Blog and Press Releases

SEPA deadline made legally binding

Fri, 24 Feb 2012 00:00:00 GMT

Banks now have no choice but to migrate to the Single Euro Payments Area (SEPA) by February 2014 after the European Parliament passed legislation to make the deadline legally binding.

An overwhelming majority of Members of the European Parliament (MEPs) voted 'yes' to the new rule, which means that European banks must begin making SEPA Credit Transfers and SEPA Direct Debits by 1 February 2014 at the latest.

The European Parliament took their initial decision to intervene in SEPA legislation after the European Payments Council's own attempts to drive SEPA adoption failed. With the deadline now firmly in place, the Parliament believes that Europe can now ensure its banks compete fairly, avoid unnecessary cross-border administration fees and accelerate payments transfers. Overall, it is estimated that SEPA could save clients, financial institutions and businesses as much as 123 billion Euros within 6 years.

And the Commission's new-found regulatory urgency seems to have had the desired effect, with the SEPA initiative finally starting to pay dividends for Europe - four years and one month after its launch in January 2008. 34% of respondents to a recent Payments Survey use SEPA Credit Transfers (SCTs) and 14% use SEPA Direct Debits (SDDs), figures which are expected to rise to 47% and 34% respectively by 2015.

Although many companies still lack a clear understanding of the way SEPA works and the benefits it can provide, such clear progress towards the eventual goal of electronic payments without borders is encouraging.

SEPA authority Sari Essayah, MEP, says: "The SEPA regulation really benefits citizens. It will enable them to make payments from one bank account to others all over Europe, just like a normal domestic payment. Companies will benefit too, by not needing more than one bank account in Europe for each payment purpose."

Cancer Research UK improves supporter experience with Albany's eVERIFY

Mon, 20 Feb 2012 00:00:00 GMT

Cancer charity integrates Albany Software with Siebel CRM to check account details in real-time and process donations without error

Cancer Research UK today announces it has implemented Albany eVERIFY, the powerful bank account validation tool from the pioneering developer of electronic payment solutions, Albany Software. By using the software, designed to crosscheck and validate UK bank account information, and integrating it with the organisation's Siebel Customer Relationship Management (CRM) system, the charity will maximise supporter donations by processing previously rejected donations as supporter bank details are validated and errors are corrected in real-time.

Cancer Research UK is the world's leading charity dedicated to beating cancer by supporting the work of over 4,000 scientists, doctors and nurses across the UK to investigate all aspects of cancer, as well as providing information for cancer patients and their families, health professionals and the general public. The main motivation for implementing eVERIFY was to prevent the loss or delay of donations through inaccurate bank account details and to save time in re-engaging with supporters.

Prior to implementing the eVERIFY solution, Cancer Research UK was only able to validate bank and credit card details when it initiated one of its bi-monthly Bacs runs, making the organisation entirely reliant on the accuracy of the details submitted by its donors over the phone. Due to human error at the point of data entry, Cancer Research UK was losing money in unprocessed payments; donations which the organisation would then have to try to retrieve, costing valuable time and resource.

Rakesh Jena, Senior Business Design Manager at Cancer Research UK, explains, "Direct Debit payments are one of our core financial processes and one of the biggest payment channels through which we get income. Before implementing eVERIFY, there wasn't any decisive control on how the account numbers and sort codes of donors were taken, which resulted in rejected payments and essentially lost donations. Our staff then had to backtrack and phone the donor again to get the right details so the payment would go through, which effectively meant campaigning twice for the same donation."

Cancer Research UK has integrated Albany eVERIFY with its Siebel CRM solution using Albany's API toolkit, enabling the charity to verify donors' account details in real-time while they are on the phone. Cancer Research has been using the solution for two months and has already seen a reduction in unprocessed payments.

Jena continues, "We have carried out two checks on our Direct Debits through December and another at the start of the month and have seen a big improvement in the number of rejected payments, with all the incorrect payments we've flagged at point of entry being prevented from going through the rejection cycle."

Jena expands, "One of the additional improvements we've seen through using the eVERIFY solution is a better reflection of our core values to our supporters. As a charity, the way we attract donations is crucial as we want supporters to understand the work we do and for donations to be processed first time. When we cannot process donations due to incorrect details or errors, it reflects poorly on us as it seems as though we're not concerned about the supporter's money, which of course is not the case."

Jena concludes, "We have worked with Albany for many years and found their expertise and support to be invaluable. The solutions they provide have helped us to make collecting payments more efficient and hassle free. This is very important, as any solution which can enable easier and more efficient donations is crucial to us."

HMRC must adapt RTI for SMEs, say Ministers

Wed, 08 Feb 2012 00:00:00 GMT

MPs believe that the introduction of Real Time Information (RTI) for Universal Credits has yet to be sufficiently explained to, or developed for, the UK's smallest businesses.

If HMRC does not find a way to cater for small firms without electronic payroll systems and self-employed workers, these groups could soon fall behind other businesses in the technology arena.

Therefore, in a recent report from the Parliament's Public Accounts Committee (PAC), HMRC has been urged to clarify how RTI will affect such companies.

According to the PAC report, 94% of UK employees are currently paid electronically by their employers, making their transition to HMRC RTI a relatively simple process. However, the remaining 6% are currently either self-employed or working for small businesses without electronic payroll systems, and neither of these demographics currently submit monthly data to HMRC.

The report goes on to suggest that if HMRC fails to develop an effective approach for those claimants and businesses without sufficient IT infrastructure, it will risk a repeat of the IT issues that disrupted the PAYE system in December 2009.

Consequently, HMRC is keen to do all it can to avoid any such issues. The PAC reports, "HMRC told us that it is currently identifying how best to include the last 6% of employees (about 1.5 million people) and the self-employed in the RTI system, but the detail of how this is to be achieved remains to be worked through."

HMRC is incorporating Real Time Information (RTI) within the PAYE process >>

January 2012 HMRC RTI Update - Only 10 weeks to go...

Tue, 31 Jan 2012 00:00:00 GMT

So here we are in 2012, and the RTI pilot commences in 10 weeks. Time is moving fast, with the first day for RTI submissions set for Wednesday 11th April and 11 companies set to go live from that day.

We've come a long way in a year and all parties now appear to be where they need to be to make this happen:

HMRC's partners have completed development and are in test
The payroll developer community is well advanced
A website to support pilot customers is due to go live 12^th April
Each pilot customer has been allocated a Customer Relationship Manager by the HMRC
Albany's solutions are RTI ready

The industry is poised to embrace this new initiative and the mood is becoming more positive by the day.

A few bits are still being tidied up from a regulatory perspective. A question mark still resides over the P45 and whether it is staying or going. It is highly likely that in the short term it will stay, with a longer term plan to eradicate its existence. You can expect an update shortly from the government on that one.

It appears that talk of the strategic solution is back on the agenda, albeit with the delivery time frame mooted as 2015 / 2016 and a continued preference for the split file concept rather than a combined file. We'll keep you posted as things evolve.

For us one major issue remains - none of the payment providers know who is in the pilot due to data protection issues associated with HMRC sharing that information. The challenge here is that the payment file format needs to change to accommodate the cross reference. As such the payments software needs to be re-configured and we would advocate doing that re-configuration now rather than in the heat of the moment on payday. This is a risk, and one which can be easily averted if pilot customers connect with their payment providers to ensure that file formats have been updated.

Our message to you remains the same... Check with both your payroll provider and your payments provider to ensure that they are ready to help you comply with RTI. Don't delay - contact them now to avoid challenges further down the line.

As always we are here to help, so if you have any questions please don't hesitate to drop us a line.

Albany HMRC RTI Updates is an ongoing series about the new HMRC RTI initiative that is being implemented in the UK. As and when new information emerges, an update email will be mailed to those registered to receive them and a new blog posted on the Albany website.

If you'd like to be kept updated on developments, then please register to receive the latest posts.

You can also view individual posts from the HMRC RTI Update Series or a consolidated view of all HMRC RTI related articles. Previous update posts are provided below:

December 2011 HMRC RTI Update - RTI advancing at a rate of knots
November 2011 HMRC RTI Update - Updated file format
October 2011 HMRC RTI Update - Gearing up for RTI
August 2011 HMRC RTI Update - RTI is gaining pace
July 2011 HMRC RTI Update - Cross reference and hash concept
June 2011 HMRC RTI Update - Moving the goal posts
May 2011 HMRC RTI Update - Technical specification
May 2011 HMRC RTI Update - Employer requirements
April 2011 HMRC RTI Update - Timescale adjustment

International Payments

Fri, 27 Jan 2012 00:00:00 GMT

UK organisations are increasingly looking to trade outside national boundaries and, as such, have an increasing need to manage payroll in currencies other than GBP.

Unfortunately, in stark contrast to the efficiency and effectiveness of UK domestic payments, the majority of international payments are expensive, time-consuming and fraught with the potential for errors.

According to research undertaken by TowerGroup, 36% of all international payers experience at least one problem at an estimated cost to UK businesses of £100m a year, with the average missing payment taking seven working days or more to rectify. This can lead to 'double dipping' where not only do you pay for the original payment but you then get charged for the 'failed' payment as well.

In the UK, the banks hold a majority market share in the processing of international payments - 97% - despite the fact that there are several high quality solution providers out there who can offer a customer-friendly alternative.

Key functions for any business trading in foreign currency are:

Transparent transaction charges
Real time exchange rates with low margins
Ease of execution
Accessibility to the service / solution from anywhere
Automation and bulk file upload
Reliability (after all, this is payroll we're talking about!)

… And in an ideal world, the international payments processing would be managed from the same platform as the domestic payments.

With the year on year growth of international trade, UK companies need to ensure their payments process is effective and efficient whether dealing domestically or across the globe. Health-check your current setup and make sure there isn't something better out there.

Background Information

Payment Services Directive:

Calls for an environment 'in which citizens and businesses can make cross-border payments as easily, safely and efficiently as they can within their own countries and subject to identical charges'.
Promotes transparency for both payer and payee within international payments systems.
Stipulates that if a payment goes missing, the onus should be on the service provider, not the customer, to proactively look to solve the problem - without charging any additional fees.

Did you know?

VocaLink are no longer supporting the SEPA initiative. SEPA (Single Euro Payments Area) is alive and kicking, but only in the intra-bank space, there is no direct access for corporates.

Defence Security Systems Safeguards Payments Process with Albany ePAY

Thu, 26 Jan 2012 00:00:00 GMT

Albany ePAY’s user-specific payment access enables Defence Security Systems to achieve greater payment control

Defence Security Systems has implemented Albany ePAY, the intelligent electronic payments and collections solution from pioneering developer Albany Software. The solution is enabling Defence Security Systems to automate much of its payment processes, increasing efficiency and flexibility. In addition, Albany ePAY allows the security systems supplier to assign different levels of authorisation to different users, allowing a tailored approach to payment security. Established in 1986, Defence Security Systems installs and services alarms, CCTV systems, fire and safety systems as well as physical security equipment. With over 4000 commercial systems and 5000 home security systems, its clients include retailers and leisure outlets, as well as hospitals and schools.

Peter Swain, Managing Director at Defence Security Systems, explains, "Our accountants noticed that the incumbent payments and accounting software was consistently failing to meet our requirements, creating inefficiencies and insecurity in the payments process. We decided it was time to look for a more comprehensive and robust solution."

Defence Security Systems went to tender and evaluated solutions from a selection of suppliers, before selecting and implementing Albany ePAY.

Swain continues, "ePAY is being used to handle all of our transactions, enabling us to automate much of the payment process, increasing payment flexibility and saving time. More specifically, we can now also restrict each stage of the payment process to a certain number of users through different levels of authorisation, allowing us to maintain greater security over our electronic payments."

In addition to the benefits of the Albany ePAY solution, Albany's expertise and professional approach also contributed to the selection.

Swain expands, "Out of the suppliers we spoke to, Albany was the only one who was interested in trying to understand our business requirements and took the time to answer our questions. Whereas the other suppliers were only focussed on selling the most expensive solution in the range, Albany provided us with the solution we needed, which was also cost effective as well."

Swain concludes, "The aftercare support from Albany has been brilliant, we needed the software to allow us to upload a database from our front-end software and Albany implemented a solution to the problem as fast as they could, with a follow up call to check it was working as effectively as possible. They made the new software very easy for new users to understand and the whole process has been a really good experience."

Software Matters

Thu, 26 Jan 2012 00:00:00 GMT

Paying the payroll on time is a vital part of any Payroll Manager’s remit. This responsibility becomes even more crucial when you consider the operation of a bureau who manage payroll on behalf of many employers

The key aspect of any bureau operation is reliability - customers rely upon their payroll bureau to process their payroll and in turn that bureau relies upon its software to manage those processes.

Take Atwell Payroll Solutions as an example. Atwell delivers payroll services to SMEs with between 1 and 310 employees. Such an operation could not function effectively without a reliable payroll and payments solution in place because the alternative is unthinkable - payroll payments cannot be late, ever.

Tough economic times exacerbate the criticality of payroll as no business can afford to suffer the disruption resulting from an unprocessed payroll run. Businesses need to know that the payroll will happen without fail.

Selecting the right software solution was therefore vital for Atwell because their core business is making payroll payments for their customers and it would be their reputation at stake if anything were to go wrong. They needed a payments solution capable of giving them stability, security and reliability along with the flexibility to meet each customer's individual needs, however complex they may be.

Victoria McLeod, partner at Atwell Payroll solutions, explains the breadth of the offering Atwell makes available to its customers. She says, "Payments via a bureau are particularly attractive to small businesses who don't necessarily have the time or resources to invest in their own Bacs software, but who want to pay their employees and suppliers through a secure Bacs system."

In closing, McLeod comments on their chosen Bacs solution, "When we created our own bureau we decided to use Albany Software as we already had a successful legacy with them. Albany's solutions had proved to be extremely successful as a payment solution in larger bureau environments and we'd heard only good things about the software, so we knew it would be ideal for our purposes."

Whether you're the Payroll Manager for an individual business or a commercial bureau, considering the efficiency and reliability of your payments process and taking action could save you time and money. Do you have contingency in place in the event of disruption to that process?

How important is bank validation to payroll?

Thu, 26 Jan 2012 00:00:00 GMT

The ongoing recession since 2008 and its knock-on effects have made it more important than ever for businesses to use bank sort code and account validation software to avoid unnecessary expenses and company disruption.

In a payroll environment, invalid bank account details can incur charges from Bacs or the submitter's bank and can leave employees unpaid and very unhappy.

Despite this, a staggering 70% of respondents to a recent survey carried out by Albany Software and the Chartered Institute of Payroll Professionals (CIPP) said they did not currently use validation software, regardless of the fact that over 90% of respondents felt that it was important or very important. Consequently, these respondents are risking their company's time and money every time they process a payroll run or pay a temporary staff member.

These results would be less troubling if none of the respondents experienced any errors with their bank details. Unfortunately, that could not be further from the truth as all who responded to the question, 'Do you ever encounter problems or rejections with incorrect sort code or account numbers?' reported that they had experienced problems. Moreover, 31% of respondents only discovered these rejections after attempting to submit a payment and a further 39% of these confirmed that at least one employee did not get paid on time.

These are worrying results that point to validation as a business-critical process for any company paying staff, temps or consultants via Bacs or Faster Payments. By validating their employees' bank details, payroll professionals can ensure they minimise the amount of money their company wastes on correcting payroll errors and free up that money for other areas of the business.

As has been clearly highlighted, the major benefits of using validation software are twofold - almost zero risk of incurring submission charges and the ability to keep both temporary and permanent employees happy by paying them on time, every time.

Is your organisation getting the most out of its payments solution?

Thu, 26 Jan 2012 00:00:00 GMT

Have you joined up the dots between one payments process and the other? It's amazing how many companies keep the physical act of processing payments for payroll distinctly separate from the process associated with suppliers.

In some cases it has been known to have payroll fully configured with electronic payments capability whilst their colleagues in Finance continue to manually raise and sign cheques.

If you find yourself using one system for payroll and another for general payments or indeed collections, then there is a good chance you could benefit from consolidating these disparate payment processes into a single system capable of handling them all.

A good quality Bacs software solution will handle payroll & supplier payments, Direct Debits and any ad hoc payments all in the same, centralised solution whilst preserving confidentiality every step of the way.

Confidentiality is assured through configurable user segregation. This means that users for payroll are kept distinctly separate from users for supplier payments such that they simply cannot see each other's work.

Concurrent usage ensures that both parties can be processing simultaneously without disturbing each others work.

Reporting enables segregated reports for individuals or consolidated reports for authorised parties.

If your organisation has invested in Bacs software for payroll then access to this sophisticated technology should be made available to your finance colleagues and if the reverse is the case and finance have embraced electronic payments ahead of your payroll department then put in a request to share the technology. Many organisations fail to connect these two functions with a common solution thus missing out on economies of scale and basic cost savings initiatives.

RSM Tenon, the UK's seventh largest accounting and advisory firm uses Albany Software's payment solution for both supplier and staff payments. Grant Sayer, National Operations and Technical Director of RSM Tenon, comments, "As Tenon expanded, the need for a consolidated Bacs system became crucial as we were simultaneously running a number of different Bacs systems from a number of suppliers. I wanted to align those systems into a robust centralised system and the Albany solution has allowed us to do just that."

European Union plans the future of payments

Wed, 25 Jan 2012 00:00:00 GMT

A new paper by the European Commission (EC) demonstrates its desire to ensure a bright future for the European payments market.

The paper analyses the current card, internet and mobile payments landscape and the Commission is asking stakeholders to offer their views on how they can achieve their aims.

The EC wants the European payments market to not only be competitive and integrated, but also innovative and up-to-date. The paper identifies what needs to change to transform the current situation into their vision of a secure, transparent and fully integrated payments market.

Such an environment would be of great benefit to consumers, merchants and providers and could lead to the creation of payment systems that are both safer and more efficient than those currently available. The EC also hopes that the Single Euro Paymens Area (SEPA) project, whose migration deadline is now set for 2014, will become a catalyst for innovation in the European payments market.

According to the EC's announcement, "The way Europeans shop and pay is radically changing". Furthermore, Michel Barnier, the EU's Internal Market and Services Commissioner, comments that "Europe has an opportunity to be at the cutting edge of what 'making a payment' could mean in the future" but is currently held back by too much "market fragmentation".

"Inefficient payments systems within the European Union unduly raise transaction costs, undermine the global competitiveness of the European economy and limit its potential for growth," adds EU Vice President Joaquín Almunia. "Europe's consumers, merchants and companies deserve payment services in tune with the 21st century: transparent, with genuine value-add and making the best use of technology."

The main issues identified in the paper concern:

Market access and entry for existing and new service providers
Payment security and data protection
Transparent and efficient pricing of payment services
Technical standardisation
Inter-operability between service providers

The paper is available on the EU website and responses can be made until 11 April 2012. Following analysis of the consultation feedback, the Commission will announce the next steps to be taken before the summer of 2012.

SEPA migration end-date set for 2014

Wed, 04 Jan 2012 00:00:00 GMT

The European Parliament and European Commission have at long last agreed an end-date for migration to the Single European Payments Area (SEPA).

Their accord means that, from 1 February 2014, all banks and financial service providers must use the same payment system.

For some time now, the European Commission has had designs on enforcing migration deadlines from national credit transfers and direct debits to SEPA (Single Euro Payments Area) instruments. In the absence of such rules, the uptake of SEPA has been markedly slow.

The Single Euro Payments Area will replace the 32 separate systems that currently operate in Europe. This will enable faster and cheaper cross-border payments within the European Union (EU). It is a move with the potential to save individuals and businesses over £100 billion within 6 years.

European Commissioner Michel Barnier said, 'SEPA brings cost-cutting potential for companies operating throughout Europe as well as authorities as there will be a wider choice of payment service provider, faster and more efficient processes as well as greater transparency. Similarly, businesses will enjoy common standards and faster settlement and simplified processing that will improve cash flow, reduce costs and facilitate access to new markets.'

Payments Council implements next-day Electronic Payments rule

Wed, 04 Jan 2012 00:00:00 GMT

On 1 January 2012, a new rule for internet and phone payments was brought into force by the Payments Council. The rule, technically known as D+1, states that payments made anywhere in the EU must reach the recipient's account by the next working day.

Even though the Faster Payments Service means that the UK already exceeds the new standard, Payments Council figures have revealed that 1 in 7 online payments in the UK took longer than a day to reach their destination in 2011 - a trend the Council is keen to put an end to.

The Payments Council anticipates that the D+1 regulation will increase the volume of UK Faster Payments by 25% this year, creating an additional 15 million electronic payments each month. The Chief Executive of the Payments Council, Adrian Kamellard, called the change 'great news for consumers and businesses'. In 2011, in excess of £200 billion was processed in more than 500 million Faster Payments transactions.

It is important to note, however, that only accounts classified as 'payment accounts' - including all UK credit card accounts and some easy access savings accounts - are subject to the new regulation. In 2011, most UK credit card accounts already benefitted from Faster Payments, in contrast to easy access savings accounts, which are regulated for the first time under the new ruling.

Accounts not subject to the new rule are those with restrictions such as notice periods or limits for withdrawing funds, for example ISA accounts. The rules for Direct Debits and Bacs Direct Credits remain unchanged because their rules dictate that money is paid and received on set dates, meaning these payment methods adhere to the new standard. Also unaffected by the new rule is that old-fashioned manual payment option the cheque, which will still take up to 6 days to process.

Top Tips for HMRC RTI

Wed, 04 Jan 2012 00:00:00 GMT

Organisations get ready for HMRC Real Time Information

HM Revenues & Customs (HMRC) is proposing a complete overhaul of the way employee information is filed, with the introduction of its Real Time Information (RTI) reporting initiative. Employers and Payroll Managers are amongst those most affected by these changes, but effective planning and preparation will minimise disruption and allow for a smoother transition to the new system.

Georgia Leybourne, Sales & Marketing Director of pioneering developer of electronic payment solutions, Albany Software, offers her 'Top Tips' to help employers prepare for the forthcoming changes to the PAYE process.

Focus on Data Quality

Potentially the Achilles' heel of the entire operation, data quality will make or break the success of RTI. If employers are harnessing incorrect information about their employees then 'matching' payments to RTI, submissions will become erroneous with employees potentially paying the penalty. It is imperative that all data held in a company's payroll system is cleansed, with particular attention paid to:

Employee name (spelling & formatting)
National Insurance Number
Date of birth (if you don't know it, leave it blank, don't use a default setting)
Gender
Address

Obtain Data for New starters

The implementation of RTI will see changes to the starters and leavers process. Currently, many companies will accept not having full data when they bring a new starter on board, but with RTI this will be unacceptable. If a piece of data is not available, for example, your new employee has not yet been issued with a National Insurance Number, leave it blank. Do not make it up.

Review your Payroll Processes

This is an essential piece of preparation that should be done well in advance of the arrival of RTI. Internal processes will be impacted by RTI as employers and payroll managers move from end of year submissions to weekly or monthly submissions alongside the payroll itself. Now is the time to consider how that will manifest itself within your organisation and ensure you have the resource and capacity to accommodate this change.

Liaise with your Payroll Software Provider

Your payroll solution will need to be upgraded with all the requisite data items and the ability to produce cross references and hashes to accompany both the RTI submission and the payment itself. It is worth liaising with your payroll software provider now to ensure they are tracking according to plan and understand the timescales and expectations for the upgrade. If you are not confident with their plans, it could be worth considering your options as it is the employer who will be mandated to comply with RTI and penalised for inability to jump on board.

Liaise with your Payments Provider

You will need to ensure your payments software can also carry the payroll file, including the RTI cross-reference. In addition, your payments software needs to be able to accept that revised file. Your payments provider will be able to advise you on its RTI readiness and how that impacts you.

Employers and payroll managers will begin to the use the Real Time Information (RTI) service from April 2013, with the expectation that all employers will be using the service by October 2013. A pilot of the service has been confirmed for April 2012, following an announcement by HMRC that there will be a delay in a core component of the RTI initiative. The decision to defer the deployment of the Bacs channel for RTI reporting and the plan to use the Government Gateway or EDI as an interim solution is politically expedient and ensures the pilot can proceed as planned next year.

However, let us not forget that this interim measure is just that, an interim. A long-term, future-proofed and strategic approach will be to submit the RTI file alongside the payments file, down the Bacs channel.

Employers and payroll managers should get on board with Bacs now, make sure they have a good, RTI-compliant Bacs solution and ensure their next move in the preparation for RTI is one that minimises disruption as much as possible.

Payments Council will not re-introduce Cheque Guarantee Card

Tue, 03 Jan 2012 00:00:00 GMT

Following independent research into its impact, the Payments Council has decided there are no grounds for bringing back the Cheque Guarantee Card.

Before its termination on 1 July 2011, the Cheque Guarantee Card Scheme made it possible 'to guarantee a cheque up to a maximum of £250 by handing over a card featuring the scheme's logo or hologram' [1].

The Payments Council (PC) decided to terminate the scheme as part of its plan to phase out cheques by October 2018. After that plan was announced in December 2009, the PC endured a widespread backlash which included a Treasury Select Committee (TSC) inquiry. The inquiry was completed in August 2011, with the TSC concluding that the PC should not be preparing to phase out cheques and should consider reinstating the Cheque Guarantee Card Scheme.

The PC agreed to investigate whether Cheque Guarantee Cards were still required in the UK. However, after studying the independent research they commissioned on the subject, the Payments Council discovered that the way cheques are currently used is much the same as it was with the Cheque Guarantee Card Scheme in place.

The research revealed that 84% of businesses surveyed still accept cheques, even without a Cheque Guarantee Card. Moreover, of the 16% of businesses no longer accepting cheques, only 5% cited the cancellation of the Cheque Guarantee Card Scheme as their reason for not accepting cheques. Therefore, the PC decided not to reinstate the scheme.

Adrian Kamellard, Chief Executive of the Payments Council, had this to say: "We've committed to keeping cheques, so we are pleased that the demise of the guaranteed cheque has had little impact on the way people use cheques, nor has it stopped businesses accepting them. It's particularly reassuring to find that older people have taken the change in their stride, however, our research has highlighted that there is a small minority of customers and businesses who might need extra help - so that will be what we're focusing on next."

Unsurprisingly, the Treasury Select Committee is less than happy with the PC's decision. TSC Chairman Andrew Tyrie said: "Any decision to reduce the use and availability of cheques would be bad news for some of the most vulnerable members of our society. We will be looking at the Payments Council's report in detail and may ask for them to come and give evidence in the New Year. The Payments Council must do more to ensure that banks do not phase out cheques on the quiet."

[1] http://www.guardian.co.uk/money/2011/dec/20/cheque-guarantee-card-abolition-stay

Foxtons Slashes Banking Fees with Albany Solution

Fri, 23 Dec 2011 00:00:00 GMT

London estate agency uses Albany’s ePAY to save £50,000 per annum

Foxtons Estate Agents has implemented Albany ePAY, the intelligent electronic payments and collections solution, from Albany Software. The solution is enabling Foxtons to process its 6,000 weekly transactions with Bacs directly, saving £50,000 per annum on banking fees.

Foxtons is London's leading estate agency and has in excess of 30 offices. It has a turnover in excess of £100 million and over 1,000 members of staff. After using a combination of separate systems to handle both its lettings client payments and corporate payments, Foxtons wanted to consolidate its transaction processing onto one system and save money on banking fees.

Gerard Nieslony, Foxtons Group Financial Controller, explains, "Before implementing Albany ePAY, we were processing transactions through a combination of different payment solutions making the process complex and costly."

After being notified that one of their software solutions was to be phased out, Foxtons decided that it was time to find a solution that could fulfil all the requirements of the business, both client and corporate.

Nieslony continues, "We thought it was time to take a fresh look and consider our options, which included looking at different suppliers. During the tender process, Albany stood out, both in terms of the usability and functionality of the ePAY solution, and in their consultative approach during the sales process. Compared to the other solutions we evaluated, ePAY wasn't over-engineered or overly complex. Albany also took care to respond to our brief and requirements and presented the solution that truly was appropriate for Foxtons."

Foxtons went live with the ePAY solution in September 2011. Since then the software has been used on a daily basis for all transactions, including lettings client payments as well as paying suppliers and staff through the monthly payroll.

Nieslony concludes, "Albany ePAY has enabled us to standardise both lettings client and corporate payments from a single central server, with one central administrator, delivering a much cleaner and neater way of dealing with our transactions. Albany ePAY is straightforward, user friendly, and performs a very simple function efficiently, without all the complicated bells and whistles which slowed down other offerings on the market. The implementation went very smoothly and any support queries have been resolved quickly and efficiently."

Payments Council promotes need for sort code validation

Thu, 22 Dec 2011 00:00:00 GMT

More than 50,000 UK businesses and charities have been informed by the Payments Council that, from 1st January 2012, they need to ensure their customer sort code checking system is correct and updated at least once a month.

This important change was prompted by an increase in new sort codes issued in the UK as growing numbers of new financial institutions and products enter the market. The Payments Council is particularly keen to assist businesses and charities in their efforts to ensure the correct sort code references are entered into their database. Without point-of-entry validation, any customer's sort code could be incorrectly imported and rejected, potentially causing issues for the customer and a loss of income for that business or charity.

The Payments Council believes that imposing a best practice of organisations updating their sort code databases at least once a month will help ensure that those organisations are protected against failed automated payments.

Typically, business and charities check sort codes via a database updated by downloading data from their payment solutions supplier. Benefactors provide their bank account number and six digit sort code to pay by Direct Debit or be paid by Bacs Direct Credit. The change in best practice involves a change in Bacs Payment Scheme Rules, meaning that payment originators (organisations) will no longer be able to rely on quarterly updates to their sort code data.

Hilary Plattern, Director of Strategy for the Payments Council, says, "Whether you are a satellite TV supplier or a small charity, if you accept automated payments from customers it is critical that the system you use to check a new customer's sort code is correct and is kept bang up-to-date. If it isn't and a sort code is wrongly rejected, a customer's patience can be tested and their business can quickly be lost. We are trying to make contact with every business and charity that could be impacted. Anyone wanting to find out more can contact their bank, a commercial provider or VocaLink."

Learn more about Sort Code Validation >>

December 2011 HMRC RTI Update - RTI advancing at a rate of knots

Wed, 21 Dec 2011 00:00:00 GMT

Shortly after last month's update, HMRC went to press with two major additions to the RTI programme:

An invitation for a further 1300 employers to join the pilot in July 2012 and another 250,000 to join in November 2012: HMRC RTI Press Release
Draft legislation to support the introduction of RTI: HMRC PAYE Documentation

The backdrop to these milestones is the on-going impetus on 'data quality', which is paramount to the overall success of the project. HMRC are working closely with over 1,000 employers to help them 'cleanse' their data in preparation for RTI to facilitate matching of employees. There is a lot of press coverage relating to this - here's a good one to give you an overview (by Employee Benefits).

It is clear that RTI will be happening in 2012. The addition of 1300 employers by July is a clear indication that the project is advancing at a rate of knots and that all involved parties are aligning themselves for the April pilot.

The timeline as it stands today:

April 2012 - 1 - 5 employers

May 2012 - 300 hand-held employers

July 2012 - 1,300 employers

November 2012 - 250,000 employers

April 2013 - Mass migration commences

October 2013 - Mandatory for all employers

A reminder to you all:

Speak to your payroll developer
If you submit payments using Bacs, speak to your payments software provider
Cleanse your data (name, address, DOB & gender in particular)
Sort out your starter & leaver processes

Last week, HMRC issued some additional documentation relating to starter and leaver scenarios, together with customer journeys and business scenarios in general, which may prove useful reading.

Good luck and if you have any queries please don't hesitate to let us know.

If you'd like to be kept updated on developments, then please register to receive the latest posts.

You can also view individual posts from the HMRC RTI Update Series or a consolidated view of all HMRC RTI related articles. Previous update posts are provided below:

HMRC RTI Update - November - Updated file format
HMRC RTI Update - October - Gearing up for RTI
HMRC RTI Update - August - RTI is gaining pace
HMRC RTI Update - July - Cross reference and hash concept
HMRC RTI Update - June - Moving the goal posts
HMRC RTI Update - May - Technical specification
HMRC RTI Update - May - Employer requirements
HMRC RTI Update - April - Timescale adjustment

Disaster Recovery problematic for many European firms

Mon, 19 Dec 2011 00:00:00 GMT

According to a survey for EMC, 54% of European companies suffered from data loss and systems failure last year, leading to reduced revenue and delays in product development.

The survey quizzed IT bosses at 1,750 companies in 7 countries on their attitudes to disaster recovery. Finance firms fared well in comparison to other sectors, 25% of them having lost data and/or suffered systems failure in the last year.

74% of respondents stated they were "not very confident" of fully recovering their systems or data after a disaster, raising serious questions about the average amount spent - 10% of their IT budget - by surveyed companies on data backup and disaster recovery. Almost a third of surveyed companies share these doubts and believe they should spend more on contingency procedures.

Tape is still used by almost half of all companies to back up their data, but 80% of those in the financial industry who use tape want to switch to disk backup. The vast majority of financial sector employees fail to take a backup home with them, leaving them unprepared in the event of freak weather forcing them to stay at home.

However, disruption caused by weather events is rare, with companies much more likely to suffer as a result of hardware failure (61%), power failure (42%), or data corruption (35%).

Nevertheless, as Neil Fisher, Vice Chairman of the Information Assurance Advisory Council, says: "It really doesn't matter if the events are routine, acts of God or the result of criminal activity. Companies who plan for events and who invest in secure and speedy recovery will be the market winners."

Small businesses urge companies to end late payments culture

Tue, 13 Dec 2011 00:00:00 GMT

The Government has this week been urged to crack down on the late payment culture amongst large corporate organisations that is “in danger of becoming endemic” by a group of organisations including Lloyds, the National Farmers’ Union (NFU) and the Forum of Private Business (FPB).

According to Bacs, small and medium-sized companies (SMEs) are owed a combined total of £33.6bn from outstanding invoice payments, the highest figure since late payment tracking was started in 2007.

According to the FPB, the late payment culture will have an impact on small businesses as they "continue to struggle to control cash flow, create jobs and drive economic growth", unless urgent action is taken.

It is thought that long payment terms agreed by suppliers are becoming a far more serious problem in recent years with many large companies taking up to four months to pay their suppliers according to Philip King, Institute of Credit Management.

An EU directive is set to be introduced in 2013, setting 30 days for standard payment terms and labelling anything longer than 60 days as potentially "grossly unfair". However, it is widely thought that companies are not using existing late payment legislation that allows companies to charge interest on overdue bills, citing that they fear being blacklisted for future work if they utilise it.

Mr King comments, "You have to ask, why a supplier agrees to [long payment terms]? 120 day terms are not good for businesses in general, and I believe it is bad practice to accept them unless it is really working in your interest".

HMRC seeks more companies for Real Time Information pilot

Wed, 30 Nov 2011 00:00:00 GMT

Her Majesty’s Revenue and Customs (HMRC) is asking for more employers to volunteer for their Real Time Information (RTI) pilot, which is scheduled to begin in April 2012.

While 300 employers have already signed up to the process, HMRC is keen to gather more data on the new payroll reporting system before raising that number to 250,000 by November 2012. As this escalation of numbers is dependent on their initial results from the April 2012 set, they aim to recruit another 1,300 volunteers to increase their data sample.

HMRC RTI is designed to improve HMRC's PAYE system and support the introduction of Universal Credit in October 2013 by the Department for Work and Pensions by enabling employers to send information on tax, National Insurance and other deductions to HMRC alongside their payroll submissions.

Stephen Banyard, Acting Director-General for the RTI project, said, "This is a unique opportunity for software developers and the employers they work closely with to help bring PAYE into the 21st century. Expanding the pilot from the original 300 employers will help ensure the smooth implementation of RTI. It is an ambitious but achievable target as we know that RTI is on track. We have considered all the technical and practical issues and are confident that we have the capacity to increase the pilot by over 300% in July next year."