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What is SEPA – Single Euro Payments Area explained

You’ve set up your business and are running it in Europe. Given this, you are most likely exchanging goods or services with other companies on the same continent and this means you need to make or receive payments in euros outside your national system. In this case, transfers will be made via SEPA.

But what is SEPA and what regulations does it include? Keep reading to find out more!

What is SEPA?

SEPA is an acronym for Single Euro Payments Area – a payment-integration initiative of the European Union. Its aim is to bring uniformity in national and cross-border payments and unanimous standards in all participating countries. Thus, it simplifies capital transfers within the union.

Citizens, businesses, and public administration can make and receive payments in euros faster and cheaper, since the same basic conditions, rights, and obligations apply, regardless of the location. SEPA payments in euro are made, using four major instruments: credit transfers, instant credit transfers, direct credit, and direct debit business-to-business.


Introducing both the Economic and Monetary Union and the euro currency has been of great importance to the formation of a single market in the European Union.

Since January 2001, it’s been possible to make same-currency cash payments all over the Eurozone. However, for a while after, with non-cash payments national, fragmentation sustained and the convenience which the euro had to address was difficult to achieve.

SEPA was started to eliminate the differences.

What are the advantages of SEPA?

The uniform conditions set out by SEPA facilitate all operations in euro in terms of ease, speed, safety, and efficiency. International payments are processed in the same way as within each of the national markets.

SEPA is among the steps toward full economic and monetary integration which benefits consumers, companies, and public administration alike. The initiative fosters an efficient European economy, fair competition, and innovation.

A quick history of SEPA

SEPA was started in 2007 when the European Union passed the Payment Service Directive. It shaped the legal basis for the integration, which was first introduced in 2008 for credit transfers. Direct debits were available as of 2009 and SEPA was fully implemented in the euro area by 2014. Several non-euro countries joined in 2016. 

At the end of 2019, the European Commission restrained banks from charging non-euro EU-member countries extra fees for transferring money out of their national system.

The extended rules set out that everyone in the European Union may transfer euros abroad at the cost they’d pay for a domestic transaction. Banks are also required to inform consumers of the currency conversion cost in advance when the currency of a cross-border payment differs from the receiver’s national acceptance.

Implementing SEPA is an ongoing process. The regulations are still to be applied to mobile and online payments

SEPA countries

SEPA has 36 members: Austria, Belgium, the United Kingdom, Bulgaria, Cyprus, Croatia, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, the Republic of Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Romania, Slovenia, Slovakia, Spain and Sweden, the three EEA countries Norway, Liechtenstein, Iceland, as well as Switzerland and Monaco.


SEPA is a system of transactions created by the European Union. Consumers, businesses, and government agents in the countries where SEPA operates can make cross-national cashless transfers.

Nearly 50 billion SEPA transactions are being processed yearly throughout the member countries. The initiative is managed by the European Payments Council in collaboration with the European Commission, the European Central Bank, and other European institutions.

Disclaimer: Please be aware that the contents of this article and the myPOS Blog, in general, should not be interpreted as legal, monetary, tax, or any other kind of professional advice. You should always seek to consult with a professional before taking action, since the particulars of your situation may materially differ from other cases.

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