SEPA Could Become the World’s Largest ‘Faster Payments’ Zone

Citing growing social and economic pressure to speed processing, the European Payments Council wants to enable real-time payments between the 34 countries in the Single Euro Payments Area (SEPA).

“The proposed scheme is the first in the world to be interoperable in a region as large as SEPA and is a response to European customer needs for faster payments,” the EPC said in a press release April 12.

The Brussels-based nonprofit organization has opened a three-month comment period on the proposed Sepa Instant Credit Transfer (SCT Inst) scheme, which would support funds-transfers occurring within 10 seconds for payments of up to EUR 15,000 each anywhere within the SEPA zone.

The goal is to reduce Europeans’ reliance on checks, cash and less convenient cross-border payments. Use cases for SCT Inst include enabling person-to-person payments, bill payment and sending tuition across borders within Europe, among other routine consumer payments.

After gathering comments from payment service providers, end users and technology participants, the EPC said it hopes to finalize the rules for SCT Inst by November and implement the new system in November 2017.

While the discussion and compliance around many of the EPC’s SEPA initiatives have dragged, the time it’s allowing between announcing and finalizing the rules for the SCT Inst is relatively short, underscoring the need to pick up the pace as other regions make advancements in real-time payments.

The U.K. Faster Payments initiative, established several years ago, has made steady progress recently in expanding access in its program to financial institutions of all sizes.

A U.S. Federal Reserve task force in February issued criteria for the long-range goals of a faster payments initiative, mirroring key elements of NACHA’s plan for same-day payments.

The EPC also noted the growing use of mobile payments as a catalyst for proposing the SCT Inst.