Achieving an optimal euro payments strategy with J.P. Morgan's Global Euro Payments

As uncertainties in the euro zone persist, the financial services industry is devoting significant resources to planning for possible market events. In parallel, the industry is preparing for migration to SEPA (Single Euro Payments Area), which needs to occur by February 1, 2014. SEPA will change the euro zone’s low-value payments and collections landscape by harmonizing the way banks make and process low-value euro payments in the 17 euro countries under a single set of SEPA Credit Transfer and SEPA Direct Debit scheme rules.

In light of these industry developments, building an optimal euro payments strategy is top of the agenda for players across the financial services industry. Our clients are focused on introducing efficient euro payments processes that ensure operational resilience and mitigate risk. At the same time, as economic and regulatory challenges place greater pressure on profitability, our clients seek top-line revenue growth and greater efficiencies across their operations.

Global euro clearing for banks

J.P. Morgan’s comprehensive euro clearing offering features a broad range of capabilities to help our bank clients achieve their goals:

  • High-value payments. We offer a range of capabilities and features that enable banks to reduce costs and generate revenues for high-value euro payments:
    • Revenue sharing capabilities for commercial payments: Flexible beneficiary deduct options, serial messaging, sophisticated pattern-matching capabilities, flexible rebate options
    • Efficiency and risk management features include serial messaging to simplify operations and reduce SWIFT costs, artificial intelligence to reduce repair costs and enhance STP, priority and timed payments
    • “Payment Forwarding” option for TARGET2 direct participants to leverage our cross-border functionality without a J.P. Morgan account

  • Cross-currency payments. Our cross-currency solutions enable banks to increase efficiency, extend reach and generate additional revenue:
    • Efficient one-stop SWIFT-based cross-currency payments execution
    • Payments in 135 currencies and receipts in 40 currencies
    • Ability to generate FX revenues via fees and mark-up

  • SEPA. We offer a range of SEPA solutions to meet individual needs, including:
    • SEPA Indirect Participation services
    • Full SEPA XML and SWIFT FileAct Communication for both SEPA Credit Transfers and SEPA Direct Debits
    • Solutions for seamlessly implementing SEPA Direct Debit Management

  • Liquidity management. Our liquidity management solutions deliver enhanced returns and boost operating efficiency for euro activity

Global euro cash management for non-bank financial institutions

Increasingly, non-bank financial institutions are centralizing their treasury activities to gain benefits from economies of scale in liquidity, foreign exchange and payment transactions. Centralization of treasury can be achieved through global or regional treasury structures. In a centralised treasury environment, it is often useful to separately manage the payment transactions and liquidity management for key global currencies, such as US dollar and euro.
Specifically, there are four areas in which non-bank financial institutions can gain efficiency by centralizing euro activity for central treasuries:

  • Low-value transactions
  • High-value urgent transactions
  • Non-European EUR flows
  • Liquidity management

Overall, we recommend that treasury units of non-bank financial institutions evaluate the benefits of centralizing EUR payments and liquidity in the EU.

Your optimal euro payments strategy
As a market leader in euro solutions, J.P. Morgan is ready to support our clients with fully integrated and comprehensive offerings for their euro activity. Call your relationship manager to discuss how we can help you to achieve your optimal euro payments strategy.

J.P. Morgan's Global Euro Payments

J.P. Morgan is a committed global payments provider and the market leader in U.S. dollar payments. We leverage our strengths, experience and capabilities in U.S. dollars to provide the same best-in-class customer service and features for euro payments. Furthermore, our financial strength and operational resilience make us a trusted partner to deliver global payment services.

J.P. Morgan Euro Payments in Numbers

  • # 3 euro clearer*
  • 98% straight through processing rate - helping to ensure timely and accurate execution of transactions
  • 20% of transactions settled across our own books - speeding execution, reducing risk and lowering expenses
  • SEPA solutions offered for 32 countries

* based on the value in TARGET2 Germany

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