SEPA Credit Transfer
The abbreviation SEPA stands for Single Euro Payments Area and thus for a uniform euro payment traffic area. A unified European payment traffic has been the declared goal of politicians and banks in Europe for many years, but it was not until 2008 that the first Europe-wide standardized payment instruments were created. However, legal requirements ensured that the nationwide introduction of SEPA Credit Transfers – known as SCT for short – was still some years away.
A look at the history
Credit transfers have been possible with SEPA since 2008, and direct debits have also been processed according to uniform specifications since 2009. In international payment transactions, the SEPA credit transfer is referred to as SEPA Credit Transfer or SCT. The next step in the migration of international payments was planned for February 01, 2014. On this date, participants in payment transactions who give their instructions online to their bank or savings bank were to convert their data to the new SEPA procedure. In concrete terms, this means that the tried and tested account number will be replaced by the IBAN, while the BIC will take the place of the bank code. Online transfers and direct debits must contain this data in the future.
Acceleration as a declared SEPA goal
SEPA aimed to treat payments within the European payment traffic area like national payments. The aim was to create a European domestic payments system that no longer differed in terms of legal requirements or pre-printed forms. SEPA was to be introduced within the EU states, with the addition of the EEA states Norway, Iceland and Liechtenstein as well as Switzerland and Monaco. By introducing standards for intra-European payment transactions, national and international payments should be processed more quickly in the future. The declared aim of SEPA is to make payments abroad and from abroad to Germany within one banking day, as is already the case for domestic transfers. This goal required extensive adjustments to the internal and external processes of banks and savings banks. In particular, the conversion of online payment transactions to the new bank sort codes and account numbers meant considerable changes to their processes for the credit institutions, which had to be implemented with long lead times.
How customers and merchants benefit from SEPA
In the future, participants in international payment transactions will benefit above all from accelerated processing. In the future, the SEPA Credit Transfer SCT will be executed within one banking day for online transfers, and an upper limit of 50,000 euros will no longer apply. However, cross-border payments of an amount of 12,500 euros or more must be reported in accordance with the Foreign Trade and Payments Ordinance. Documentary transfers should also reach the recipient after two days. This will make it quicker and easier for merchants and private participants in international payment transactions to receive their payments in the future.
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