What is SEPA?
- The Single Euro Payments Area (SEPA) is a European Union regulation that will simplify electronic financial transactions – credit transfers and direct debits.
- The SEPA area consists of the existing member states of the European Union, together with Iceland, Lichtenstein, Monaco, Norway Switzerland and San Marino.
- SEPA will replace national payments systems with a single set of SEPA standards and payments schemes.
- Organisations and individuals will be able to make payments to anyone within the area through their existing bank account using standardised payment instruments.
- SEPA applies to electronic non-urgent euro payments only, cheques and cash, will not be affected.
- The aim of SEPA is to make all electronic cross-border payments in euro between the participating countries as easy, inexpensive and secure as ‘national’ payments within one member state are today.
- In SEPA a customer can make electronic payments to any beneficiary located anywhere in the euro area using a single bank account and a single set of payment instructions. This means that making a payment from Dublin to Dusseldorf will cost the same as from Dublin to Dingle, and will be processed within the same timeframe.
- SEPA payments are next day value payments.
- SEPA comes into full effect on 1 February 2014 for countries where euro is the domestic currency e.g. Ireland.
In November 2014, New Ross Credit Union rolled out the SEPA Direct Debit Scheme. This means that direct debits can be made from any domestic account to any receiver within the participating countries. For example, an Irish customer with a holiday home in Spain may now pay all utility bills relating to the Spanish property from one domestic account in Ireland. Or foreign workers in Ireland may have their salaries paid directly into their domestic account, eliminating the need to open many different accounts.