Frequently Asked Questions
Questions
What is the Single Euro Payments Area (SEPA)?
Where did this initiative originate from?
What are the objectives of SEPA?
Will SEPA cover Euro currency only?
What payment types are covered under SEPA?
What is the SEPA Credit Transfer (SCT) Scheme?
How can I send a SEPA credit transfer?
How long will it take for a SEPA credit transfer to reach the beneficiary (i.e. clearing cycle)?
Can I continue to make payments within Ireland using National Sort Code (NSC) and Account Number?
Will SEPA impact customers who transfer money within the Republic of Ireland only?
What is the SEPA Direct Debit (SDD) Scheme?
What is the SEPA Cards Framework (SCF)?
When will SEPA happen?
Who benefits from SEPA?
What countries are in the SEPA zone?
Who is responsible for the implementation of SEPA?
What is a SWIFT Address / BIC?
What is an International Bank Account Number (IBAN)?
Where can I find my BIC and IBAN?
Answers
Q: What is the Single Euro Payments Area (SEPA)?
A: As the name suggests, SEPA aims to create a single common market within Europe whereby customers will be able to send and receive Euro currency payments across Europe.
There will be no difference in making a Euro payment within Ireland (i.e. AIB to another Irish Bank account) versus making a payment within Europe (i.e. AIB to Spanish Bank).
SEPA is not only about improving the processing efficiency of international euro payments. SEPA is a major project which will have an impact on domestic payments markets and will introduce new business rules and technical standards. All electronic payments, domestic and international, will be affected and all credit transfers, direct debits and card payments will migrate eventually to SEPA standards.
Since the launch of SEPA in January 2008 it has transformed the way payments are made and will be a key step towards the completion of the Single Market in the SEPA zone.
Q: Where did this initiative originate from?
A: The objective of the Single European Market is the free movement of people, goods, services and capital. On a practical level, it means that European Union (EU) citizens can live, work, study and do business throughout the EU as well as enjoy competitively priced goods and services. Since its inception in 1993, the Single Market has provided economic and working opportunities that have transformed the lives of hundreds of millions of Europeans.
The EU already has a common currency, the Euro. The next major milestone in achieving the Single Market is to create a Single Euro Payments Area (SEPA).
The SEPA programme has been championed by the European Commission (EC) and the European Central Bank. The project is being delivered by the banking industry which took up the challenge by creating the European Payments Council (EPC) in 2002.
Q: What are the objectives of SEPA?
A: The main objective of SEPA is to make it easier for customers to effect Euro currency payments across the SEPA zone.
In the new SEPA world businesses or individuals can make an electronic payment to any recipient located in the SEPA zone from their bank account using the BIC and IBAN standard to identify the recipient's account. SEPA will bring with it improved payment service levels, more efficient products and cost effective national and international payments.
Q: Will SEPA cover Euro currency only?
A: Yes. SEPA covers Euro currency transactions only within the SEPA zone.
Q: What payment types are covered under SEPA?
A: There are three payment types involved in SEPA:
- SEPA Credit Transfer Scheme
- SEPA Direct Debit Scheme
- SEPA Cards Framework
Q: What is the SEPA Credit Transfer (SCT) Scheme?
A: Credit transfers are commonly used to send and receive payments from bank accounts. They include payments using Branch, Internet or Telephone banking, as well as salary or pension payments into bank accounts.
The SCT scheme ensures customers can make electronic payments to any customer located anywhere in the SEPA zone using a single bank account (BIC & IBAN) and a uniform set of standards, rules and conditions.
Q: How can I send a SEPA credit transfer?
A: First of all you will need to know the recipients BIC (Bank Identifier Code) and IBAN (International Bank Account Number). AIB has introduced international (excluding Ireland) SEPA Credit Transfers outgoing capability to participating banks within the SEPA zone through the AIB Branch Network. Customers will shortly be able to make SEPA Credit Transfers using AIB Internet Banking (personal customers) and iBusiness Banking (business customers). The service will be introduced on a phased basis throughout 2009. AIB will provide you with further details on live dates shortly.
Q. How long will it take for a SEPA credit transfer to reach the beneficiary (i.e. clearing cycle)?
A. The clearing cycle for a SEPA credit transfer is very similar to the clearing cycle for existing domestic electronic payments, i.e. a maximum of 3 working days.
The date cycle above indicates the maximum execution timeframe permitted under the scheme rules. It is envisaged that in transitioning to SEPA that the SCT payments will retain any existing shorter execution timeframes supported by current national payment schemes. The ultimate goal of the SEPA project is to achieve an execution timeframe of D +1 by 2012, or earlier, for all SCT payments.
Q: Can I continue to make payments within Ireland using National Sort Code (NSC) and Account Number?
A: Yes. Customers will have a choice of whether to use the new SEPA standards (BIC & IBAN) or continue to use the domestic standards (NSC & Account number) to effect payments within the Republic of Ireland. Post 2011 all domestic schemes will be phased out as all Euro credit transfer and Euro direct debit transactions will be processed in the SEPA formats.
Q: Will SEPA impact customers who transfer money within the Republic of Ireland only?
A: No, not in the short term. However, you now have the choice of whether to use the new SEPA standards (BIC & IBAN) or continue to use the domestic standards (NSC & Account number) to effect payments within the Republic of Ireland. You will need to know the BIC and IBAN of the receiver to effect payments in SEPA standard.
In the future (Post 2011) all domestic schemes will be phased out as all euro credit transfer and euro direct debit transactions will be processed in the SEPA formats.
Q: What is the SEPA Direct Debit (SDD) Scheme?
A: The SEPA Direct Debit Scheme was launched in 2009. Customers are now able to use direct debits to pay bills in euro anywhere in Europe, not only in Ireland. For example, consumers with property abroad are able to pay their utility bills from their bank accounts in Ireland without the need to have an account in another country. Bank Customers will also be able to make one-off payments as well as recurring direct debit payments.
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Q: What is the SEPA Cards Framework (SCF)?
A: From the 01st January 2008, the SEPA Cards Framework will enable customers to use their general purpose cards (Credit and Debit cards) to make payments and cash withdrawals in Euro throughout the SEPA zone with the same ease and convenience as they do in their home country. There will be no difference whether they use their card(s) in their home country or elsewhere within Europe.
Q: When will SEPA happen?
A: SEPA will be delivered across Europe on a phased basis. AIB's card suite has been compliant (through Maestro on our debit cards and through the Visa and MasterCard schemes on our credit cards) since January 2008. From early 2008, customers have been able to send and receive credit transfers using the SEPA standards.
Q: Who benefits from SEPA?
A: Benefits to the consumer: The main objective of SEPA is to underpin the Single European Market, which has as its objective the creation of a pan-European market for goods and services. A consumer wishing to pay in euro for goods or services within the SEPA zone can do so using their existing bank account as easily as making a payment in their national market. SEPA will enable individuals that live, work or study in another SEPA zone country to use their existing bank account to complete their normal payment transactions. Existing EU legislation requires banks to charge the same fees for international transfers in euro within the EU (amounts up to EUR50,000) as they do for equivalent national transfers.
Benefits to the merchant: In the SEPA zone, all acquiring banks will have the facility to process all SEPA-compliant card payments. This will allow the merchant to choose any acquirer bank within the SEPA zone to process their card payments, increasing competition and driving down costs. The merchant will also benefit from a wider choice of terminal providers in the market place, making it possible to accept a wider range of cards with a single terminal at point-of-sale.
Benefits to companies: SEPA will help companies to streamline their payment processes for payments within the SEPA zone. The adoption of a single formatting standard for national and international payments within the SEPA zone should assist companies to reduce their costs in making or receiving payments. Furthermore, SEPA will enable companies to rationalise their banking arrangements across the SEPA zone, at least for their euro denominated activity. It will reduce the requirement to maintain bank accounts in different countries in order to access the local payment systems. SEPA will enable companies to effect national payments in other countries as if they were located in and maintained a bank account in those countries.
Companies will also benefit from the potential development of increased integration between their bank's payment systems and their own processing systems. The potential to develop standardised e-invoicing and e-reconciliation services across the SEPA zone is another benefit emerging from SEPA.
Companies will also benefit from the increased ability of a larger number of banks to provide them with payment services. SEPA will enable companies to purchase payment services from banks that are not physically located in their own country.
Benefits to banks: Banks can now support their customers' euro payment activity, both payables and receivables, across the entire SEPA zone. SEPA will also enable banks to compete for payment business across the entire SEPA zone.
Q: What countries are in the SEPA zone?
A: The 32 countries that are impacted by SEPA are listed below;
1. Austria
2. Belgium
3. Bulgaria
4. Cyprus
5. Czech Republic
6. Denmark
7. Estonia
8. Finland
9. France
10. Germany
11. Greece
12. Hungary
13. Ireland
14. Italy
15. Latvia
16. Lithuania
17. Luxembourg
18. Malta
19. Monaco
20. Netherlands
21. Poland
22. Portugal
23. Romania
24. Slovak Republic
25. Slovenia
26. Spain
27. Sweden
28. Switzerland
29. United Kingdom
30. Iceland
31. Liechtenstein
32. Norway
Q: Who is responsible for the implementation of SEPA?
A: SEPA will be implemented by banks, payment associations and public authorities in each country in the Euro area. Corporate and financial institution clients will be key to the success of SEPA.
Q. What is a SWIFT Address / BIC?
A: The Bank Identifier Code (BIC), also known as the SWIFT Address, is the code necessary to send automated International / SEPA Payments quickly and accurately to the banks concerned.
AIB?s (ROI) SWIFT Address / BIC is AIBKIE2D. Based on payment instructions together with the receiver's International Bank Account Number (IBAN), the SWIFT Address / BIC facilitate streamlined processing of payments. The SWIFT Address / BIC is a mandatory requirement for EU regulated and SEPA payments i.e. it must be included on Paylink Euro - standard and/or urgent payment instructions to avail of the lower pricing and also SEPA credit transfers. SWIFT Addresses / BIC codes consist of either 8 or 11 alphanumeric characters and can be verified using the following website: www.swift.com/biconline
Q. What is an International Bank Account Number (IBAN)?
A. The 'International Bank Account Number' or 'IBAN' is a standard for quoting account numbers across Europe. The use of an IBAN and the receiving bank SWIFT address / BIC code (Bank Identifier Code) enables your international / SEPA payment to be made automatically, ensuring the correct identification of your receiver's bank account.
Q: Where can I find my BIC and IBAN?
A: Your BIC and IBAN are located on your AIB bank account statement.
Related Information
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Single Euro Payments Area (SEPA)