The SINGLE EURO PAYMENTS AREA (SEPA) is a payment-integration
initiative of the
* 1 Goals
* 2 Overview
* 2.1 Schemes
* 2.1.1 Credit Transfer * 2.1.2 Instant credit transfer * 2.1.3 Direct debit
* 3 Coverage * 4 Charges * 5 Key dates * 6 Uptake * 7 See also * 8 References * 9 External links
The project's aim is to improve the efficiency of cross-border payments and turn the fragmented national markets for euro payments into a single domestic one. SEPA will enable customers to make cashless euro payments to anyone located anywhere in the area, using a single bank account and a single set of payment instruments. People who have a bank account in a eurozone country, will be able to use it to receive salaries and make payments all over the eurozone, for example when they take a job in a new country.
The project includes the development of common financial instruments , standards, procedures, and infrastructure to enable economies of scale . This should, in turn, reduce the overall cost to the European economy of moving capital around the region (estimated as two to three percent of total GDP).
There are two milestones in the establishment of SEPA:
* Pan-European payment instruments for credit transfers began on 28 January 2008; direct debits and debit cards became available later * By the end of 2010, all present national payment infrastructures and payment processors were expected to be in full competition to increase efficiency through consolidation and economies of scale
For direct debits, the first milestone was missed due to a delay in
the implementation of enabling legislation (the Payment Services
Directive or PSD) in the
* Credit transfers: SCT – SEPA Credit Transfer * Direct debits: SDD – SEPA Direct Debit. Banks began offering this service on 2 November 2009. * Cards: SEPA Cards Framework
To provide end-to-end straight through processing (STP) for SEPA-clearing, the EPC committed to delivering technical validation subsets of ISO 20022 . Whereas bank-to-bank messages (pacs) are mandatory for use, customer-to-bank Payment Initialization (PAIN) message types are not; however, they are strongly recommended. Because there is room for interpretation, it is expected that several PAIN specifications will be published in SEPA countries.
Businesses, merchants, consumers and governments are also interested
in the development of SEPA. The European Associations of Corporate
Treasurers (EACT), TWIST , the
European Central Bank
Since January 2008, banks have been switching customers to the new
payment instruments. By 2010, the majority were expected to be on the
SEPA framework. As a result, banks throughout the SEPA area (not just
SEPA clearance is based on the IBAN bank-account identification and
the SWIFT-BIC bank identifier. Domestic euro transactions are routed
by IBAN; earlier national-designation schemes were abolished by
February 2014, providing uniform access to the new payment
instruments. Since February 2016
An instant 24/7/365 payment scheme named SCT Inst is scheduled to be implemented by November 2017. This will allow real time payments 24 hours a day and 365 days a year. The participating banks will handle the user interface and security, like for existing SEPA payments, e.g. web sites and mobile apps.
SEPA covers predominantly normal bank transfers. Payment methods which have additional optional features or services, such as mobile phone or smart card payment systems, are not directly covered. However, the upcoming instant SEPA payment scheme will facilitate future payment products also on smart devices.
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The different functionalities provided for by SEPA are divided into separate payment schemes, detailed below.
Credit transfer (SCT) allows for the transfer of funds from one bank account to another. SEPA clearing rules require that payments made before the cutoff point on a working day, be credited to the recipients account within 1 working day.
Instant Credit Transfer
Instant credit transfer (SCT Inst), when launched, will provide for instant crediting of a payees (less than 10 seconds, initially, with a maximum of 20 seconds in exceptional circumstances).
Direct debit functionality is provided by two separate schemes. The basic scheme, Core SDD, was launched on 2 November 2009 , and is primarily targeted at consumers. Participation by banks offering SEPA payments is compulsory. In addition, there is a second scheme, B2B SDD, targeted towards business users. It requires a mandate be submitted to the bank by both the creditor and debtor. Among other differences, it does not allow the debtor to request a refund from its bank after its account has been debited. Participation in the scheme is optional.
SEPA consists of 34 countries:
* The 28 member states of the
* the 19 states that are in the
* the nine states that are not in the Eurozone:
* The three states having signed the European Economic Area agreement:
* A few other countries with agreements with the EU:
All parts of a country are normally part of SEPA. However, the following countries have special territories which are not part of SEPA:
* Cyprus: Northern
SEPA guarantees that euro payments are received within a guaranteed
time, and banks are not allowed to make any deductions of the amount
transferred, introduced by a regulation in year 2001. Banks and
payment institutions still have the option of charging a
credit-transfer fee of their choice for euro transfers if it is
charged uniformly to all EEA participants, banks or payment
institutions, domestic or foreign. This is relevant for countries
which do not use the euro; domestic transfers in euro by consumers are
uncommon, and inflated fees might be charged.
In Regulation (EC) 924/2009, the
Introduction of the euro as an electronic currency, including
introduction of the RTGS system
2001 EC Regulation 2560/2001 harmonises fees for cross-border and domestic euro transactions
2003 First pan-European ACH (PE-ACH) goes live; EC Regulation 2560/2001 comes into force for transactions up to €12,500
2006 EC Regulation 2560 cap increases euro transactions up to €50,000
2008 SEPA pan-European payment instruments become operational (parallel to domestic instruments) on 28 January
2009 Payment Services Directive (PSD) enacted in national laws by November
2010 SEPA payments become dominant form of electronic payments
SEPA payments replace national payments in the
Since 31 October 2016, payment service providers in non-euro
countries are only able to collect euro-denominated payments using
SEPA procedures. Non-
2017 Starting 21 November 2017, instant SEPA payments of up to 15,000 euros within 10 seconds. (optional participation for PSPs)
As of August 2014, 99.4% of credit transfers, 99.9% of direct debit and 79.2% of card payments have been migrated to SEPA in the euro area.
The official progress report was published in March 2013.
In October 2010, the
European Central Bank
* ^ A B "5. Report for Selected Countries and Subjects".
International Monetary Fund. 17 June 2011. Retrieved 10 July 2013.
* ^ "Human Development Report 2013" (PDF). UN. 2013. Retrieved 14
* ^ A B List of SEPA Scheme Countries
* ^ "Solution: SEPA, the single euro payments area". European
Central Bank. Archived from the original on 20 March 2008. Retrieved
28 January 2008.
* ^ "Agreement reached on cross-border banking". RTÉ News. 27
March 2007. Retrieved 28 January 2008.
* ^ "Joint statement by the