To Embrace the SEPA Era

SEPA, known as ‘Single Euro Payment Area’, has brought earth breaking changes to the landscape of pan-European payment instruments. In this article, we are going to discuss following questions, what are the values that SEPA can bring to both customers and businesses, what are the latest updates about SEPA and last but not least, what are the unique solutions we can provide.

In a nutshell, SEPA is an EU-wide policy-maker-driven integration initiative designed to strengthen the euro currency, enhance competition in the payments market and drive forward technological innovation.

As published on the Official Journal of the European Union, the SEPA Regulation defines 1 February 2014 as the deadline in the euro area for compliance with the core provisions of this Regulation. Effectively, this means that as of this date, existing national euro credit transfer and direct debit schemes will be replaced by SEPA Credit Transfer (SCT) and SEPA Direct Debit (SDD).  For non-European countries this deadline is set to be 31st of October 2016. All the above-mentioned news mean that existing national direct debit and credit transfers schemes will be eventually replaced with SEPA ones.

So, what are the values that SEPA can bring to customers and businesses?

The first and foremost one is convenience. Once the SEPA is achieved, it will be possible to exchange euro payments between any accounts within SEPA as easily as it is within national borders.

Secondly, efficiency gain and cost deduction, as results of SEPA’s implementation, are great values that SEPA brings to businesses. With common standards, faster settlement, simplified processing and  improved cash flow, operation cost will be further lowered down and access to foreign markets will become easier.

Moreover, with replacement to SEPA instruments from the existing national payment instruments, consumer will be able to rely on a single set of euro payment instruments covering 33 countries, with one bank account, one bank card, one SEPA Credit transfer(SCT)  and one SEPA Direct Debit(SDD).

On top of that, customer will further enjoy benefits resulting from increased competition in the payments  market. As SEPA replaces the existing payment system eventually, there will be a 123 billion euro potential market, cumulative in six years and benefiting the users of payment system.

The last but not least, the position of consumers will be strengthened when making payments with SEPA’s adoption. Users of SEPA direct debits now explicitly have the right to limit direct debit collections to a specific amount or to a certain periodicity and to block direct debit transactions in relation to specified people. Moreover, a verification of each direct debit transaction by the payment services provider is foreseen in cases where no refund right is provided for in a mandate.


Therefore, as a potential beneficiary, being a customer or an online business, when can I benefit the values that SEPA could bring to me?

Payment21® makes your company SEPA-compliant immediately… read more about our solutions on the page for SEPA

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