SEPA Direct Debits a Reality, but Not All Countries Transposed the PSD

From 2 November, banks have started to offer customers the possibility to make regular payments using the new single euro payments area (SEPA) Direct Debit (SDD) scheme. This means that, for the first time, consumers and businesses will be able to make direct debit transactions between different countries in the euro area. Supporting the industry-led scheme are new EU rules on payment services and cross-border payments, Payment Services Directive (PSD), in force as of 1 November, which are designed to ensure that SDD will be as easy, efficient and secure as national schemes without being more expensive. Thousands of euro area banks have already signed up for the new scheme.

Internal Market and Services Commissioner Charlie McCreevy said: “This is another significant achievement on the road towards a single euro payments area. Thanks to industry’s efforts and a solid legal platform at EU level, direct debit payments can now be made between different countries in the euro area – good news for consumers, for businesses and for the economy as a whole. This is a new and highly innovative product with real practical benefits, and I encourage those banks not currently participating in the scheme to join the thousands that have already signed up.”

The PSD ensures that electronic payments within the EU – mainly direct debits as well as credit transfers and card payments – become as easy, efficient and secure as the corresponding domestic payments. Moreover, the PSD reinforces the rights and protection of all users of payment services, such as consumers, retailers, businesses and public authorities. Most of the Member States have met 1 November deadline for the implementation of the directive, while the remaining states should do it by the end of the year (with two exceptions: Finland and Sweden).

The revised Cross-Border Payments Regulation extends the principle of equal charges for national and cross-border payments in euro (up to €50,000) to direct debits. Credit transfers, electronic payments (including card transactions) and ATM cash withdrawals were already covered by the previous version of the Regulation. Furthermore, in order to facilitate the launch of the SEPA Direct Debit scheme, the Regulation also introduces temporary rules on multilateral interchange fees between banks and establishes a deadline for full reachability for direct debit transactions by November 2010 in the euro area. For banks from the non-euro area, this deadline is November 2014.


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