SEPA
What is SEPA?
The Single Euro Payments Area (SEPA) comprises the 27 EU member states, as well as Iceland, Liechtenstein, Norway and Switzerland. It is an area within which you can make and receive payments in euro, under the same basic conditions, rights and obligations, regardless of their location, whether between or within national boundaries.Who Makes it Happen?
- Public authorities: the European Commission, the European Central Bank and EU governments must create the appropriate conditions to support the migration of bank customers to the new SEPA payment instruments.
- Banking industry: the European Payments Council (EPC) is the banking industry’s decision-making and co-ordination body in relation to payments. The EPC has successfully delivered the necessary SEPA payment schemes and frameworks to build the integrated euro payments market (SEPA Credit Transfer, SEPA Direct Debit and the SEPA Cards Framework).
- Bank customers: SEPA will only succeed, when customers – in particular the business community and public administrations – embrace the new SEPA payment instruments.
SEPA Beneficiaries
Benefits for Consumers:The consumer will be the major beneficiary of the SEPA, which will offer greater choice of service, competition and flexibility. A consumer wishing to pay for services within any of the European countries involved in SEPA, (i.e. utility bills or maintenance on property abroad, etc.), may now do so using one domestic bank account, eliminating the need to open a separate overseas account. It also means that people who live, work or study outside their own country may use their account in their home country to complete all their transactions.
Customers will also be able to use the same payment card for all euro payments within the participating countries, making the use of cards more efficient. The primary aim of SEPA is to enhance the provision of all electronic payment services to the customer — this will open up the market to innovative services such as e-invoicing, e-ticketing, mobile and internet payment initiatives, etc., all designed to make the payment process less time-consuming and simpler for the customer.
Benefits for Businesses:
SEPA will make a standardised payment infrastructure available, which opens up new possibilities to expand businesses beyond national borders.
The introduction of the ISO 20022 XML message standards – the SEPA data format – will allow for rationalisation, which in turn will significantly reduce the costs currently associated with the maintenance of different national payment formats and related IT standards, including system administration.
Benefits for Creditors:
SEPA will provide a simple and cost-efficient way to collect funds using a single payment instrument across European countries. SEPA will also provide the certainty of payment completion within a pre-determined time cycle, as well a straight forward reconciliation of payments received.
SEPA will also provide the ability to automate exception handling for events such as returned, rejected or refunded collections and reversals.
SEPA Legal Framework (Payment Services Directive)
On 1st November 2009 the Payment Services Directive (PSD) was transposed into legislation in Ireland and throughout the EU. This Directive ensures that the same legal framework applies to all payments made within Europe whereby businesses and consumers can make payments easily, cost-effectively and efficiently. The PSD establishes the necessary legal framework for SEPA payments and also applies to existing national payment products. The PSD was transposed into Irish legislation as the European Communities (Payment Services) Regulations 2009.
European Payments Council (EPC) Plenary
The Plenary is the main decision-making body of the EPC. All EPC committees and other bodies that may be established on an ad hoc basis report to the EPC Plenary. With the exception of the Co-ordination Committee, these bodies can only make recommendations to the EPC Plenary, and have no decision-making power. The Plenary meets at least once every calendar year to hold the Annual General Meeting.
The Plenary expresses its position and will by means of Resolutions, and a register of Resolutions is maintained by the EPC Secretariat at the registered office of the EPC. Only EPC Resolutions may be presented to third parties as representative of the EPC position. EPC Resolutions are freely communicated to third parties, unless the EPC Plenary decides otherwise. All EPC members have one vote and Resolutions are passed at a two-thirds majority (however, any amendment to the Charter is subject to Art.17).
Co-ordination Committee
The Co-ordination Committee deals with all issues relating to the EPC mission statement and scope, as described in the preamble.
It is charged with drafting the agendas of the Plenary, the daily management of EPC and monitoring the implementation of EPC decisions in co-ordination with the European Credit Sector Associations (ECSAs) and national banking committees.
The Co-ordination Committee establishes the annual accounts of the previous financial year and prepares the budget for the next financial year.
The Co-ordination Committee is composed of up to 26 members in total (and never less than 15).
EPC Working Groups
The Plenary can set up Working Groups, supported by specific Terms of Reference approved by the Plenary, Working Groups hold their mandate from, and report to, the EPC Plenary. Working Groups have no decision-marking power, and can only make recommendations to the EPC Plenary after a positive review by the Co-ordination Committee.
Working Groups can be composed of Plenary members and non-members, and are chaired by an EPC representative appointed by the Plenary upon the proposal of the Nominating & Governance Committee. The Working Group Chair is a member of the Co-ordination Committee — if a Working Group Chair ceases to be an EPC Representative, his/her mandate shall terminate immediately and a new Chair shall be appointed for the rest of the term.
Current Working Groups / Committees Include:
- SEPA Payment Schemes Working Groups
- SEPA Programme Management Forum
- SEPA Cards Working Group
- SEPA Cash Working Group
- SEPA Standards Working Groups.
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