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You are here: Home -> News -> STEP2 Irish Service Successfully Launched  A A 

The STEP2 Irish Service was successfully launched on 10th October and is working well. The three objectives of the project, set less than one year ago, have all been fully met. The three core objectives were:

1. To deliver a next day value service for all electronic payments both domestically and cross - border (SEPA)
2. To eliminate the settlement risk associated with the Irish Retail Electronic Clearing Company’s (IRECC’s) settlement process
3. To extend the cut-off times for making payments

Mick O’Neill, SEPA Programme Manager at IPSO said “Following extensive testing, we are delighted that both the preparations and the launch of the STEP2 Irish Service went smoothly and in a timely manner, less than a year after we announced our decision to develop the service”.

Next Day Value (D+1)
Customers of IRECC’s six member banks can now make payments up to mid-afternoon (between 15:00 and 16:00 depending on the bank in question) and be guaranteed that the beneficiary account will be credited on the next business day. This applies to both domestic payments and cross border payments within the Single Euro Payments Area. This was a requirement set out in the Payment Services Directive (PSD).

Settlement Risk
Before the service was launched, IRECC’s settlement process carried a significant risk for IPSO member banks. Each day, transaction files were bilaterally exchanged between member Banks, processed overnight and then settled in the Central Bank the following morning. . With the new service, banks send their settlement figures to EBA STEP2, in late afternoon, who then calculates a multilateral net position for each member and this position is then settled at 19.00 each evening before the banks process the transactions files, eliminating the risks previously involved.

Cut-off Times
The PSD states that banks must establish a payment cut-off time close to the end of the business day. The new STEP2 service has enabled all banks to extend their cut-off times to mid-afternoon and offer improved payment processing services to their customers.