SEPA goes live!
SEPA goes live!
The Single European Payments Area (SEPA) for credit transfers was launched this week, with the European Commission (EC) predicting potential savings of £268bn over the next six years.
Businesses in the Eurozone (i.e. the 15 nations that use the euro currency) should start to see faster and cheaper payments as of 28th January, as the new “SEPA Credit Transfer” service is launched.
Electronic payments in euro between different countries currently cost more than making a bank transfer in the same country. With the roll-out of the new standards over the next three years, SEPA will make all electronic payments in the Eurozone the same as making domestic payments, and guarantee that the money will pass from one bank account to another within three days.
The European Commission sees this as a logical extension to the introduction of the euro. As EU internal market and services commissioner, Charlie McCreevy explains: “SEPA will improve the efficiency and competitiveness of the single market and realise our ambition to make euro payments across the EU as easy, efficient and secure as domestic payments”.
Although the UK does not use the euro, businesses with a presence in the Eurozone will need to change their processing systems if they want to make lower cost SEPA transactions, and UK banks will need to upgrade systems to support it.
SEPA has initially been launched for credit transfers, but the facility is due to be extended to direct debits by 2009.