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What is SEPA Instant?

Rob Keating
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Last editedJun 20222 min read

Most consumers nowadays expect to be able to make and take instant card payments, to and from their family and friends. For many businesses, however, the reality has been different, with payments, in the form of invoices and bills, still taking days to settle. Incompatible systems, high fees, and complexity all add to the problem.

SEPA instant payments: A fast cross-border payment solution

To help create a better solution for businesses, individual European countries like Germany, the UK, and Norway, decided to create their own, better payment solutions. Faster Payments, for example, offers businesses a way to transfer and receive funds, in real-time, within the UK.

However, while national payment systems helped businesses make seamless domestic payments, cross-border payment transfers still remained problematic.

This is why the SEPA (Single Euro Payment Area) was created.

SEPA was the first important step in connecting Europe’s banking system, facilitating faster and more efficient payments between European banks. Now there’s SEPA Instant, a pan-European network that enables instant bank transfers across Europe. SEPA Instant allows payment providers that sign up to the SEPA Instant banks system to perform close to instant transfers, across Europe.

What are SEPA instant payments?

SEPA Instant payments enable euro transactions to take place in just seconds, at all times of day and night. Unlike with most other payment systems, the speed of payment doesn’t depend on an individual payment provider’s own clearing and settlement capabilities. As long as they are signed up to SEPA Instant, transfers should happen in close to real-time, or in less than 10 seconds.

How does SEPA Instant credit transfer work?

Banks usually process their credit transfers in batches. They place these batches into a “big batch”, before submitting them for clearing and settlement, at the end of each business day. With SEPA Instant, payments take place on a transaction level.

The importance of SEPA Instant

The launch of the European SEPA SCT instant system is an important milestone towards creating real-time, cross-border payment services between participating banks. UK businesses can take one-off and recurring payments via SEPA Instant from their customers in Europe and, through GoCardless, have payment settled in their UK bank accounts.

This saves businesses the hassle of having to open countless individual bank accounts in order to facilitate payments across borders. With SEPA Instant, businesses can receive their foreign currency payments in real-time conversion rates too, for added transparency.

SEPA Instant credit transfer is useful for individual person-to-person transactions, too, as well as person-to-business payments, in all kinds of environments and industries.

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The benefits of SEPA Instant payments

  • Transaction amounts of up to 100,000 euros for instant transfers.

  • Speed of transaction with the vast majority of transactions completed in under 10 seconds.

  • Availability, with transactions executed in real-time, 24/7.

  • Flexibility: SEPA Instant payments can be initiated irrespective of the payment provider’s clearing or settlement arrangements. However, both the sending and receiving bank must have SEPA Instant enabled for transactions to complete.

The future of SEPA Instant payments

Many European payment providers have joined the scheme already. The combination of convenience, trust and functionality looks certain to see fast adoption of SEPA Instant in the years to come.

We can help

GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Find out how GoCardless can help you with ad hoc payments or recurring payments.

Easily collect payments from your European customers without the need for complicated legal and financial paperwork. Save time and stress as GoCardless makes getting paid from Europe super-simple and hassle-free.

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Interested in automating the way you get paid? GoCardless can help
Interested in automating the way you get paid? GoCardless can help

Interested in automating the way you get paid? GoCardless can help

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