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SEPA – Single euro payments area

SEPA – Single euro payments area . Author : Pavel Tolar. What is SEPA?. Safe and efficient payments, throughout Europe

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SEPA – Single euro payments area

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  1. SEPA – Single euro payments area Author: Pavel Tolar

  2. Whatis SEPA? • Safe and efficient payments, throughout Europe • The Single Euro Payments Area (SEPA) is a project to harmonise the way we make and process retail payments in euro. The goal is to make payments in euro and across Europe as fast, safe and efficient as national payments are today. SEPA enables customers to make cashless euro payments to anyone located anywhere in Europe, for example by credit transfer, direct debit or debit card.

  3. SEPA countries • All countries within the European Union (EU) • Iceland • Norway • Liechtenstein • Switzerland • Monaco

  4. SEPA's milestones • 2001: European regulation on cross-border payments in euro (Regulation No 2560/2001) stipulated that payment charges for cross-border euro payments (by credit transfer or payment card) within the EU should be the same as for corresponding domestic euro payments. • 2002: Set-up of the EuropeanPaymentsCouncil (EPC) • 2007: Adoption of the PaymentServicesDirective as the legal basis for retail payments in Europe. • 2008: Start of SEPA credittransfers • 2009: Start of SEPA directdebits • 2012: Regulation No 260/2012entered into force, which establishes technical and business requirements for credit transfers and direct debits in euro.

  5. EPC - EuropeanPaymentsCouncil • The European banking industry established the European Payments Council (EPC) in 2002 as its coordination and decision-making body on issues relating to payments. The EPC consists of 74 members representing banks, banking communities and payment institutions. More than 360 professionals from 32 countries are directly involved in the work of the EPC. The European Central Bank (ECB) takes part as an observer in the EPC’s working and support groups.

  6. SEPA in phases • Design - TheEuropeanPaymentsCouncil (EPC) establishedtherulesandpracticesforthenewpaymentschemesandselectedthestandards to beapplied. • Implemantion - Eachparticipating country set upnationalimplementationandTheEuropeanCommissionprovided a harmonisedlegal basis forthepayments market in Europe in theformofthePaymentServicesDirective. • Migration - Providersandusersofpaymentservicesswitchover to SEPA paymentinstruments.

  7. Paymentinstruments • credittransfers • directdebits • paymentcards

  8. Credittransfers • A credit transfer is a paymentinitiated by thepayer. Thepayersends a paymentinstruction to his/her paymentserviceprovider. Thepayer’spaymentserviceprovidermovesthefunds to thepayee’spaymentserviceprovider.

  9. Directdebits • A directdebitis a transfer initiated by thepayee, thatisthe recipient of a payment, via his/her paymentserviceprovider. Directdebits are oftenusedforrecurringpayments, such as utility bills. Theyrequire a pre-authorisation (“mandate”) fromthepayer. Directdebits are alsousedforone-offpayments. In this case, thepayerauthorisesanindividualpayment.

  10. Cards • Types of payment cards • Debit cards Debit cards allow the cardholder to charge purchases directly and individually to an account. • Credit cards Credit cards allow purchases within a certain credit limit. The balance is settled in full by the end of a specified period. Alternatively, it is partly settled. The remaining balance is taken as extended credit on which the cardholder must pay interest.

  11. SEPA in Czechrepublic • In theCzechrepublicoffers a SEPA paymentsixbanks • Unicredit bank • Komerční banka • J&T • Citi bank • Česká spořitelna • ČSOB

  12. SEPA in figures • Currently the SEPA initiative involved 4,500 banks. European clearing house (EBA clearing) daily realized 470,000 SEPA payments in the amount of nearly € 3 billion

  13. Topicsfordiscussion • What do youthinkabout SEPA? • Isthe SEPA forretailclientsorforcompanies (business)?

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