Single Euro Payments Area (SEPA) - changing the way Europe pays

Following the introduction of Euro coins and notes in 2002 and the creation of a single currency, further initiatives are underway to simplify the way in which payments are made throughout the Eurozone.

The banking industry is working towards the creation of a single payments market for handling Euro transactions across the European Union. The creation of SEPA will allow individuals and businesses to make and receive Euro payments across the Eurozone in a way that is in line with domestic transactions.

The complexities associated with making Euro cross-border payments in the Eurozone will be gradually removed. A more streamlined infrastructure will be phased-in to allow quicker and more efficient movement of payments, with greater visibility of the costs involved.

SEPA will bring many benefits. The main aim is to create a series of common standards, rules and payment processes for making payments across the Eurozone. As part of this, payment remitters now have to quote the beneficiary International Bank Account Number (IBAN) and the Bank Identification Code (BIC).

In 2008, further steps will be taken with the initial launch of SEPA - compliant payments to transfer and receive monies. At first, these will co-exist with existing payment services, but by 2010 they will be phased-out.

With such standards in place, as well as the adoption of common processes across the banking community and the EU, moving money crossborder will become more efficient and competitive.

• For more information about the Single Euro Payment Area (SEPA) download our factsheet (148KB PDF) and frequently asked questions (601KB PDF)