Bank to Bank Transfer – Part I
Standard Process for Bank to Bank Transfer – Part I
Bank to Bank Transfer has been one of the important process of every business.
We have been doing business day in and day out. The business regularly performs transactions, as a result involves receipt and payment of money. Business needs cash management to effectively manage funds. Every business has own way of managing cash and as a result of which many end up opening multiple bank accounts. This is done to control the flow of funds (receipt in one bank account and payment from other).
This process helps business manage cash flow, but also sets up a challenge of making funds available whenever and wherever required. It obviously involves transfer of funds from one bank to other and also one account to other. This transfers can at times be difficult to manage. At the same time it becomes important to ensure flow of funds in a certain way due to business reasons. It is due to this, the authorisation of funds transfer becomes a must in order to avoid any problems.
In order to meet all of the above requirements, SAP has come up with a standard solution where we can perform Bank to Bank Transfer with ease. This is done without compromising validating of amounts to be transferred.
We will try to understand this functionality in two parts i.e. a) Configuration required and b) Transactions to perform
Configuration
SPRO => Financial Accounting (New) => Bank Accounting => Business Transactions => Payment Transactions => Payment Request => Define Clearing Accts for Receiving Bank for Acct. Transfer
We are navigated to following screen:
1.1 – Configuration
Enter the required information as above (G/L account to be debited). Create Transport request for the same.
SPRO => Financial Accounting (New) => Bank Accounting => Business Transactions => Payment Transactions => Payment Handling => Bank Clearing Account Determination => Define Account Determination
Enter Company Code as below:
1.2 – Configuration
And SAP will navigate us to the following screen where we maintain the G/L account to be credited
1.3 – Configuration
Maintain the relevant information and create Transport Request.
Transactions
The transactions are divided into following parts:
Creating Repetitive Codes
Maintain Repetitive Code is the transaction where we maintain the list of Sending and Receiving Banks. Here we maintain the bank accounts from where funds can be transferred and the accounts who can receive them. This step helps us set up a validation to control flow of funds and prevent transfer of funds to unauthorised location.
Transaction Code: OT81
SAP Menu => Accounting => Financial Accounting => Banks => Master Data => OT81 – Repetitive Codes
System navigates us to the following screen:
2.1 – Maintain Repetitive Code
On this screen, we have to specify the sending bank and receiving bank. Enter following information to proceed:
Company Code
House Bank (Sending Bank)
Account ID (Sending Account)
After entering all above information, click on Create (F7) button and we have to select as below:
2.2 – Bank to Bank Transfer
Further, maintain details of banks who are authorised to receive the funds transfer:
2.3 – Maintain Repetitive Code
This screen requires following information
Repetitive Code : Enter an identifier to know the Sending and Receiving bank combination
Processing Bank Data
Paying CoCd : Will come automatically from previous screen
House Bank : Will come automatically from previous screen
Account ID : Will come automatically from previous screen
Target Bank
Company Code : Enter Company Code of receiving bank
House Bank : Enter House Bank of Receiving Account
Account ID : Enter Account ID of Receiving Account
Payment Information
Pymt Method : Enter Payment Method using which amount can be transferred
Currency : Enter currency
Default Values
Reference text : Enter Reference Text
Individual Payment : Select this check box if you wish to post separate document for every transfer. If this checkbox is not ticked, multiple requests can be clubbed together for posting to FI
Business Area : Enter Business Area
After entering all the above information, click on save button.
Releasing Repetitive Code
The Repetitive Code so created can not be immediate used for transfer of amounts. It is required to be released, as we can see in the following screen the status of this sending and receiving bank combination is not released (Red)
2.4 – Maintain Repetitive Code
Some authorisation person needs to release this combination by selecting the line and clicking on Release (Flag). Funds transfer between two banks can be initiated only after release of the Repetitive Code combination. System does not allow transfer of funds for banks where the combination is not released.
After release the screen looks as below:
2.5 – Release Repetitive Code
After release, click on save. Release is not saved without saving the combination i.e. release is not saved if if you click on release and exit without saving . SAP shows about saving of the combination on click of save button.
In the next post we will how transfer is actually performed.