Two Significant Steps in the Introduction of SEPA:
(I)In 2008 a payment infrastructure for credit transfers were introduced uniformly to all European countries and was soon to be followed by direct debit and debit card options. Implementation of EU legislation (PSD) was delayed which would have enabling direct debts this meant that direct debts was only introduced in November of 2009. With the delay in this first major step pressure was on to insure the smooth and timely implementation of the second important step in the project.
(II)By the end of 2010 all existing national payment infrastructures and payment processors in Eurozone countries were to be adapted, consolidated and fully competitive, increasing efficiency for economies of scale.
Most of the procedures covered by SEPA are conventional bank transfers or Euros; other payment and transfer methods (mobile options or smart card payment options through corporate bank accounts or private account) which have other services or features are not directly addressed by the SEPA project. In the future an additional SEPA scheme will make payment options available on smart mobile devices.
With SEPA Euro payments must be made within a specified time. According to regulations introduced in 2001 banks are prohibited from making any deductions from the transferred funds however banks and other payment institutions retain the right to charge a fee for credit transfers so long as the fee for a Euro transfer is charged to all banks and EEA participants, foreign or domestic. This is an important point for countries with a currency other than Euro; it is uncommon for domestic Euro transfers to be made by consumers and elevated charges might be implemented. For example in Denmark and Sweden legislation states that transfer of Euros must incur the same charges as Danish Krone or Swedish Krona transfers. In effect this means that there are free ATM withdrawals of Euros although there are fees for an ATM withdrawal of other EU currencies.
Has SEPA Succeeded in Integrating the European Payment System?
SEPA has proved to be an essential part of the integration efforts in Europe, most importantly in corporate banking. When first introduced some payment institutions and banks considered SEPA to be an expensive burden but now the financial market is ready to really benefit from the infrastructure which has been established. Projects like SEPA enable the acceleration of smooth, integrated cash management services in Europe.