Report Foreign Payments with the SCB Indicator to Comply with Foreign Trade Regulations

  • by Kees van Westerop, Senior SAP Consultant, Kwest Consulting
  • September 15, 2008
Get an understanding of the State Central Bank (SCB) indicator, which you can use to fulfill legal foreign trade regulations. See an overview of the mandatory and optional customizing settings that are necessary to process the SCB indicator in the correct way in your SAP system. Discover where to find the SCB indicator within the financial transactions in your SAP system.
Key Concept

One of the foreign trade regulations taken by national banks to control foreign payment transactions is that banks are obliged to report foreign payments (i.e., payments to banks abroad or in a foreign currency) including the business reason for the payment. To facilitate this, you can use the State Central Bank (SCB) indicator in your SAP system to identify payments to be reported to a national bank. The SCB indicator also indicates the business reason for the payments.

Within several EU countries and some non-EU countries, foreign trade regulations require local banks to report foreign payments to their national bank. Foreign payment means either a payment in a foreign currency or a payment to a foreign bank. Typically, the information sent to the national bank includes the business reason for the payment.

To fulfill these legal requirements, you need to include the information on foreign payments in the payment files delivered by companies to their local banks, which you get from the financial documents being paid. You enter the foreign payment information in the SAP system manually in the relevant documents. The information contains the State Central Bank (SCB) indicator and supplying country. You only need the field Supplying Country, which stands for the country to which the payment is sent, in Germany.

The SCB indicator represents the information to be sent with a payment. Because the foreign trade regulations differ per country, the information represented by the SCB indicator differs per country. Also, the situations in which the SCB indicator is required are different for each country.

Table 1 shows the SCB indicator requirements for each country. For example, the indicator in Germany is required if a payment is made in a foreign currency to a foreign bank. In Norway, the SCB indicator is only read if a payment is made in a foreign currency. Every country requires that the country of the vendor or customer differ from the company code country.

Kees van Westerop

Kees van Westerop has been working as an SAP consultant for more than 25 years. He has an MBA degree in mathematics and a degree in finance. Kees has been concentrating on the financial modules, especially in general ledger accounting, cost center accounting, and consolidation. He also has a great deal of experience with rollouts of kernel systems and integrating finance and logistics.

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