The European Parliament has recently approved an amendment to SEPA (Single Euro Payments Area) in order to improve the efficiency and speed of money transfers in Europe. According to the official press release, the main objective is to reduce waiting times for SMEs and users, while ensuring the security of transactions.
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To achieve this goal, MEPs have approved a proposal to update the SEPA legislation, in order to make transfers more timely and cheaper. This change is of fundamental importance for the proper functioning of the European single market and to foster the economic growth of businesses.
“Instant Transfers: Fast and Free Money Transfers”
One of the most interesting parts of the package concerns instant transfers, which offer the possibility of transferring money immediately. According to the proposal, an instant transfer should be executed instantly, regardless of the day or time it is processed. This means that the transferred amount should be credited to the beneficiary's account within 10 seconds from the time the payment order is received.
To ensure this transfer speed, all banks and credit institutions, as well as payment service providers, are required to offer this possibility to users without charging extra costs compared to traditional bank transfers. In addition, such instant transfers are also available for payments to EU countries where the Euro is not in force.
"If a payment order for an instant credit transfer in euro is submitted from a non-euro payment account, the PSP should convert the transaction amount from the currency in which the payment account is denominated into euro immediately after receiving such payment order.” continues the European Parliament according to which “The fees charged by a PSP to payers and beneficiaries in relation to instant credit transfer operations in euro may not be higher than the fees charged for credit transfer operations in euro.".
During the parliamentary debate, MEPs stressed that Payment Service Providers (PSPs) are not allowed to increase the costs of traditional transfers, either directly or indirectly, in order to circumvent this rule. This directive was approved with a large margin of votes in favour, 49, while only 2 MEPs voted against and 2 abstained. The negotiation phase with the Council will now begin in order to seek an agreement for the implementation of this new regulation.
Article published on 30 June 2023 - 12:51
