EC proposes to accelerate rollout of instant payments in euro

The European Commission (EC) adopted on October 27 a legislative proposal to make instant payments in euro available to all citizens and businesses holding a bank account in the EU and in EEA countries, the EC said in a statement.

The proposal aims to ensure that instant payments in euro are affordable, secure, and processed without hindrance across the EU, the statement said.

Instant payments allow people to transfer money at any time of any day within 10 seconds.

This is much faster compared to traditional credit transfers, which are received by payment service providers only during business hours and arrive at the payee’s account only by the following business day, which could take up to three calendar days.

“Instant payments significantly increase speed and convenience for consumers, for example when paying bills or receiving urgent transfers (e.g. in case of medical emergency),” the statement said.

“In addition, they help to significantly improve cash flow, and bring cost savings for businesses, especially for SMEs, including retailers.”

The statement said that they free up money currently locked in transit in the financial system, the so-called “payment float”, which can be used sooner for consumption or investment (almost 200 billion euro are locked on any given day).

But at the beginning of 2022, only 11 per cent of all euro credit transfers in the EU were instant, the statement said.

“This proposal aims to remove the barriers that prevent instant payments and their benefits to become more widespread.”

The proposal, which amends and modernises the 2012 Regulation on the Single Euro Payments Regulation (SEPA), consists of four requirements regarding euro instant payments.

The first is making instant euro payments universally available, with an obligation on EU payment service providers that already offer credit transfers in euro to offer also their instant version within a defined period.

The second is making instant euro payments affordable, with an obligation on payment service providers to ensure that the price charged for instant payments in euro does not exceed the price charged for traditional, non-instant credit transfers in euro.

The third is increasing trust in instant payments, with an obligation on providers to verify the match between the bank account number (IBAN) and the name of the beneficiary provided by the payer in order to alert the payer of a possible mistake or fraud before the payment is made.

The fourth is removing friction in the processing of instant euro payments while preserving the effectiveness of screening of persons that are subject to EU sanctions, through a procedure whereby payment service providers will verify at least daily their clients against EU sanctions lists, instead of screening all transactions one by one.

“This proposal will support innovation and competition in the EU payments market, in full conformity with existing rules on sanctions and fighting financial crime,” the statement said.

“It will also contribute to the Commission’s wider objectives on digitalisation and open strategic autonomy,” it said.

The EC said that the initiative aligns with the Commission’s priority of delivering an economy that works for people and creates a more attractive investment environment.

(Photo: Miroslav Saricka/

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