SEPA PROXY LOOKUP.


REGULATORY / FRAMEWORK CONDITIONS OF IDENTIFICATION WITH THE SEPA PROXY LOOKUP (SPL)

The first efforts to implement a SPL process go back to independently developed P2P payment pro-cesses. In order to ensure the interoperability that had been lacking within Europe, the SPL idea was created as part of the newly founded Mobile Proxy Forum (MPF) in 2015.
In March 2018, even before the first Rulebook was published, the MPF commissioned equensWorld-line, the favored SPL service provider, with develop-ing a suitable service. After the first version of the SPL Rulebook was made available to the general public in December 2018, equensWorldline started their service in March 2019.[1] Subsequently, a second revised version of the set of rules was published by the European Payment Council (EPC) in March 2020. [2]
In addition to general rules and standards, this sec-ond version includes the criteria for participating in the SPL procedure. The following three substantial (optional) changes were included:


[1]   See https://equensworldline.com/en/home/news-and-pressreleases/pr-2019_03_05_01.html 

[2]   See https://www.europeanpaymentscouncil.eu/document-library/rulebooks/sepa-proxy-lookup-spl-scheme-rulebook-version-20 


TECHNOLOGIES / FUNCTIONSALITIES  OF IDENTIFICATION WITH THE SEPA PROXY LOOKUP (SPL)

Standardized SPL interfaces are decisive for harmo-nizing payment procedures across Europe. Similar to the XS2A interface in the PSD2 environment, within the scope of SPL two central interfaces will also safeguard the exchange and security of data.
In the SPL settlement process, we need to differentiate between the following main actors:

  • Initiating Registry Provider (IRP): activates the SPL service in order to receive the account data via the proxy.
  • SPL Service: SPL system operator who, among others, provides the required infrastructure.
  • Responding Registry Provider (RRP): receives the SPL request and transmits the account data.

In order to participate, an additional contractual ba-sis between the parties IRP / RRP and the SPL ser-vice is required. An option includes the so-called reachability check which can be used by the IRP for payer onboarding.
A participant may act in multiple roles either as an IRP, RRP and/or PSP.


USER EXPERIENCE IN IDENTIFICATION WITH THE SEPA PROXY LOOKUP (SPL)

Payer and Payee log into their app with their respec-tive proxies (e.g. mobile number) and the ID of the selected payment method (currently their IBAN, at a later stage possibly their card number).
Next, the payer searches for the Payee's proxy in his app. If the Payee has previously been registered in the system, payments can be initiated.
Initiating payments is as easy as writing a message in a messenger. It is therefore conceivable that (messenger) apps include an ID for a payment method in the user’s profile record.


STRATEGIC POTENTIAL OF IDENTIFICATION WITH THE SEPA PROXY LOOKUP (SPL)

SPL is to be considered under aspects of usability and interoperability. Using this service significantly simplifies the handling of the IBAN. The associated opening of SCT payments for the everyday and app-based use opens a wide range of new use cases. Compared with card payments and other payment methods, the position of SCT for everyday use at the POS and in eCommerce will be strengthened.

We would also like to emphasize the interoperability approaches associated with SPL. While SPL was in-itially intended to connect national P2P processes, it can also be enhanced as a general proxy solution for additional payment procedures. This results in further developing existing payment methods and their respective established processes. Card pay-ments onto current accounts and any other payment combinations using SPL might soon become daily routine.
Consequently, banks have developed their own pay-ment apps in addition to their online banking apps or explicit payment functions within these apps.
However, some questions relating to processing of personal data in compliance with the law or technical interoperability, especially with regard to RRP pro-cessing, remain to be determined.
Generally speaking, SPL will play a key role in digit-izing payment transactions in the context of retail payments across Europe. Standardized use cases in the corporate customer environment that use ex-tended proxy services will contribute to the success and spread of this procedure and will provide the platform for new options in offering cash manage-ment.
In a progressive scenario, companies lacking a li-cense as payment service provider or as a bank, but possessing an extensive mobile number database, e.g. Messenger services, will play an essential role in enabling the initiation of a payment.


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