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Learn Everything About Sepa Payment Gateway Just Within 10 Minutes

Friday, 11 Feb, 2022

You’ve heard of SEPA payment gateway, but what SEPA stands for, what SEPA payment gateway is, and how does it actually work, as well as what is the easiest way to access SEPA gateways for cross border payments in Europe? In this post, we will go over all you need to know about SEPA online payment method. Now, let’s start off with the SEPA payment definition.

SEPA online payment method is the easiest way of cross border payments in Europe.

SEPA online payment method is the easiest way of cross border payments in Europe.

1. What is the Single Euro Payments Area (SEPA)?

The Single Euro Payments Area (SEPA) is a system of transactions created by the European Union (EU). The SEPA harmonizes the way cashless payments are transacted between Euro countries. People conducting business in these countries now make cross-border cashless payments at the same cost and convenience as domestic payments thanks to SEPA online payment method.

SEPA payment definition for your information.

SEPA payment definition for your information.

The SEPA is managed by the European Payments Council on a collaborative basis with the European Commission, the European Central Bank (ECB), and other European stakeholder groups.

There are 36 countries that participate in SEPA, which is an well-established home market area for making cross-border Euro bank transactions. It essentially makes international money transfers easier by making it equivalent to domestic transactions. This means that even if you’re transferring funds between two banks that are in different SEPA countries, you can enjoy a fast transaction and minimal transfer fee.

KEY TAKEAWAY

  • SEPA was put in place to streamline payment management, reduce processing and banking costs, and shorten processing times.
  • The Single Euro Payments Area is approved and regulated by the European Payment Council (EPC).

2. Facts & Figures of SEPA

What is the SEPA payment system?

What is the SEPA payment system?

Name Single Euro Payments Area.
Implementation year

 

2014 for Euro area countries .

 

2016 for Non-Euro area countries.

Currency Euro (€).
Cashless payment instruments Credit transfer, direct debit.
Speed of processing No longer than 1 business day for electronic payment orders, 2 business days for paper-based payment orders.
SEPA area countries 36 countries (includes some non-euro area and non-EU countries).
Stakeholders European banking and payments industry, payment service users, national governments, the European Commission, the Eurosystem, and several other public authorities.

3. Which countries apply the SEPA payment method?

27 Member States of the European Union (EU):

Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.

6 non-EEA countries, to which the geographical scope has been extended:

Andorra, Monaco, San Marino, Switzerland, United Kingdom, Vatican City State, Saint-Pierre-et-Miquelon, Guernsey, Jersey, Isle of Man.

3 countries of the European Economic Area (EEA):

Liechtenstein, Iceland, and Norway.

Is the UK a SEPA member?

The EPC has approved the ongoing participation of the UK in the SEPA payment system schemes in the event that the UK leaves the EU without a trade agreement in place.

SEPA payment method is applied in the UK which will be treated as a “third country”.

SEPA payment method is applied in the UK which will be treated as a “third country”.

The UK departed the EU on January 31, 2020 and entered an 11-month implementation period under the provisions of its withdrawal agreement with the EU. During this implementation period, EU legislation will continue to apply in the UK.

From January 1, 2021, subject to any trade agreement entered into between the EU and the UK, the UK will be treated as a “third country” under the rules of SEPA.

KEY TAKEAWAY

  • Although the UK is no longer part of the EU, it is still part of the SEPA payment system scheme as a non-EEA SEPA country.

4. Difference between SEPA and SWIFT.

4.1. SEPA definition vs SWIFT definition:

SEPA
(Single Euro Payments Area)
SWIFT
(Society for Worldwide Interbank Financial)
This type of payment transfer makes it possible for people and businesses to send and accept sepa payments in Euro throughout Europe with the same convenience as they do when paying in their home country. In brief, SWIFT is the leading global messaging system that banks and other financial institutions use. It transmits information and financial messages related to payments and transactions worldwide.

4.2. Differences between SEPA and SWIFT:

  • SWIFT enables money transfers internationally, while the SEPA payment system can only be made within the SEPA area.
  • SWIFT transfers can be executed in various currencies while the SEPA payment system initiative encompasses transfers in Euro only.
  • The speed at which the SEPA payment system be made is fast. It takes less than one business day after the document is processed.

Despite their differences, both SWIFT and SEPA payment system share the same goal, which is to offer seamless, secure, and reliable money transfers to people and the businesses, and to enhance the integrity of the increasingly dynamic payment environment.

5. How does SEPA work?

SEPA payment system uses the International Bank Account Numbers (IBAN). SEPA payment method with additional optional features or services such as mobile phone or smart card payment systems, are not directly covered. To make SEPA payments, you only need to have the payee’s bank details in the international format. Most SEPA transfers arrive in the beneficiary’s bank account within 1-2 business days.

6. Why should merchants open a SEPA account in Europe?

SEPA payment gateway brings numerous benefits for merchants in the EU zone.

SEPA payment gateway brings numerous benefits for merchants in the EU zone.

  • Elimination of barriers to make international SEPA payment types.
  • Cost-effective harmonized SEPA payment system.
  • Simplicity and convenience.
  • SEPA payment system allows for cross-border transfer without incurring charges as if one is making a transfer to a local bank.
  • SEPA payment system minimizes failed payments due to card expiry or cancellation.
  • SEPA payment system reduces administrative time, such as when updating card details.

7. SEPA countries and IBANs.

Even if you don’t live in the SEPA area countries, you can still open a non-resident virtual bank account with an International Bank Account (IBAN) in Europe and be able to make Euro transfers without a fee if it’s an internal bank transfer (same bank), and small fee if it’s a transfer between different SEPA bank accounts.

IBAN (International Bank Account Number) is an internationally agreed system of identifying bank accounts across national borders to facilitate the communication and processing of cross border transactions with a lower chance of transcription errors. It was originally adopted by the European Committee for Banking Standards (ECBS) and afterwards as an international standard.

Using the SEPA payment gateway and IBAN can avoid extra fees that may occur.

Using the SEPA payment gateway and IBAN can avoid extra fees that may occur.

An IBAN consists of up to 34 alphanumeric characters comprising a country code, two check digits, and a number that includes the domestic bank account number, branch identifier, and potential routing information.

Transferring funds overseas from your bank account can sometimes be costly and time consuming. By using your IBAN number, you can avoid extra fees that may occur when your bank needs to reverse an incorrect payment, also reduce international transfer errors as well as speed up transfer times.

While the IBAN system was originally developed to streamline payments in the EU, it has now been adopted by many other countries and regions, including the Caribbean and Middle East. As of May 2020, 77 countries were offering IBANs. You can find a full list of all the countries using the system here.

8. A must-have SEPA online payment method for companies in Europe.

If you want to sell to European consumers, accepting SEPA payments is imperative. Choosing a SEPA payment gateway that automates cross-border transactions can improve your bottom line, enhance compliance, and simplify your ability to get funds easily and promptly. PayCEC’s SEPA gateway is one of the quickest, cheapest, and safest ways to get your money across from one eurozone country to another. Besides, PayCEC’s SEPA payment gateway is compliant with International Bank Account Number (IBAN) requirements. IBANs are needed to make a cross-border payment using the SEPA payment system.

9. PayCEC is the best SEPA online payment method provider for merchants.

PayCEC launched its ready-made SEPA online payment method in October 2021 that enables merchants to access SEPA without any intermediary bank. Besides, PayCEC’s SEPA payment gateway fee is considered cost efficient as it is lower than international bank transfers.

SEPA gateway helps entrepreneurs do business with confidence.

SEPA gateway helps entrepreneurs do business with confidence.

You can do business with confidence because PayCEC’s SEPA online payment method offers SCA (Strong Customer Authentication) for extra fraud protection, ensuring the safety and security of payments. Furthermore, PayCEC’s SEPA payment gateway also transfers customers' data to SSL-encrypted, which means the address starts with https:// rather than http:// to guarantees a secure connection.

With PayCEC’s SEPA payment gateway, start collecting payments within the eurozone is so easy. Learn more

Read more:

About PayCEC SEPA payment gateway

PayCEC’s SEPA payment gateway was established in response to the growing need of businesses to accept SEPA payments more quickly and easily. In the digital era, our payment flow has evolved to work seamlessly and effectively across all platforms and devices. We pride ourselves on combining superior technology with first-class customer service.

PayCEC’s payment gateway is a truly global payments platform that not only allows customers to get paid instantly and securely, but also withdraws funds to their business accounts in various currencies.

We have created an open and secure payments ecosystem that entrepreneurs and businesses choose to securely transact with each other online and on any device. We proudly maintain the highest level of client advocacy in the industry.

PayCEC Team

Frequently Asked Questions

SEPA allows customers to make cashless Euro payments to any banking account and anywhere as long as they are inside SEPA's supported territory. PayCEC launched its ready-made SEPA payment gateway that enables merchants to access SEPA without any intermediary bank.

PayCEC offers the lightning-fast and most secure SEPA payment gateway with hassle-free integration for merchants to accept SEPA payments from customers' accounts in 36 SEPA countries and associated territories. Besides, PayCEC’s SEPA payment gateway fee is considered cost-efficient as it is lower than international bank transfers.

Name

Single Euro Payments Area.

Implementation year

2014 for Euro area countries.

2016 for Non-Euro area countries.

Currency

Euro (€).

Cashless payment instruments

Credit transfer, direct debit.

Speed of processing

No longer than 1 business day for electronic payment orders, 2 business days for paper-based payment orders.

SEPA area countries

36 countries (includes some non-euro area and non-EU countries).

Stakeholders

European banking and payments industry, payment service users, national governments, the European Commission, the Eurosystem, and several other public authorities.

With PayCEC’s SEPA payment gateway, start collecting payments within the eurozone is so easy.

PayCEC’s SEPA payment gateway is one of the quickest, cheapest, and safest ways to get your money across from one eurozone country to another. Besides, PayCEC’s SEPA payment gateway is compliant with International Bank Account Number (IBAN) requirements. IBANs are needed to make a cross-border payment using the SEPA payment system.

PayCEC offers the lightning-fast and most secure SEPA payment gateway with hassle-free integration for merchants to accept SEPA payments from customers' accounts in 36 SEPA countries and associated territories. Besides, PayCEC’s SEPA payment gateway fee is considered cost-efficient as it is lower than international bank transfers.

Choosing PayCEC’s SEPA payment gateway that automates cross-border transactions can improve your bottom line, enhance compliance, and simplify your ability to get funds easily and promptly.

With PayCEC’s SEPA payment gateway, start collecting payments within the eurozone is so easy.

PayCEC’s SEPA payment gateway provides a possibility to open a bank account remotely. It means that you will receive your businesses’ unique IBAN, and will be able to use it no matter what country you’re located in. When it comes to SEPA countries, you can make SEPA payment countries with such an account.

PayCEC’s SEPA payment gateway ensures businesses can accept digital banking transfer payments from customers located anywhere in the SEPA countries list using a single bank account (IBAN) and a uniform set of standards, rules, and conditions.

See more how to set up SEPA payment here.

Yes, PayCEC’s SEPA Payment Gateway now accepts quick bank transfers within the SEPA network from European banks and payment institutions. PayCEC wants to be featured primarily in the UK, EU markets, and other entities in the US, Canada, and APAC which have IBAN bank accounts. Every PayCEC’s client will have an IBAN business account that can acquire online SEPA transfers from their customers.

These merchant’s IBAN business accounts are able to collect digital banking transfers from all banks in the SEPA scheme countries, including 27 Member States of the European Union (EU), 3 countries of the European Economic Area (EEA), and 6 non-EEA countries, to which the geographical scope has been extended.

PayCEC’s SEPA payment gateway now accepts quick bank transfers within the SEPA network from European banks and payment institutions. PayCEC wants to be featured primarily in the UK, EU markets, and other entities in the US, Canada, and APAC which have IBAN bank accounts. Every PayCEC’s client will have an IBAN business account that can acquire online SEPA transfers from their customers.

These merchant’s IBAN business accounts are able to collect digital banking transfers from all banks in the SEPA scheme countries, including 27 Member States of the European Union (EU), 3 countries of the European Economic Area (EEA), and 6 non-EEA countries, to which the geographical scope has been extended.

To accept SEPA payments, you need to integrate PayCEC SEPA Payment Gateway.

There are 2 different types of SEPA payments, which are SEPA credit transfer and SEPA debit transfer. When it comes to SEPA, it is very important to differentiate these two types of SEPA payments. Each one offers a distinct service:

SEPA credit transfer

In SEPA credit transfer, money is transferred in the form of Euro. It transfers cash from one bank to another by the use of IBAN codes (International Bank Account Number), which is an internationally agreed system of identifying bank accounts across national borders to facilitate the communication and processing of cross-border transactions with a reduced risk of transcription errors. Customers in the SEPA area countries utilize it as a one-time payment option for products and services.

SEPA debit transfer

SEPA debit transfer in the SEPA area countries list also uses Euros but it is not a one-time payment method. It is a recurring payment method. The one paying has to authorize payment by providing information about the bank account name and number, IBAN and BIC. The payee has to retain the authorization of the recurring payment. The authorization can either be in electronic or in paper.

The debit transfer in the SEPA area countries list can be set to make recurring payments for a specific number of times or indefinite payments until the authorization is canceled. The set up is done between the customer and the business or between two businesses. For instance, it can be set to pay monthly rent, electricity bill, or other subscription services.

To know how SEPA payments are processed, let’s check out the steps below for your information.

  • Step 1: The customer presses a “Purchase” button or relevant button, and fills in the necessary fields to pass the transaction data.
  • Step 2: Select your payment method and proceed to payment.
    • Credit/Debit card (Visa / MasterCard / Amex / Discover / JCB).
    • E-wallet (PayPal).
    • Wire bank transfer.

(In case the customer chooses the SEPA Transfer (for European clients) option: When you transfer in Euro currency, it will take 2-5 days. But if your bank is based in countries supported by SEPA Transfer in Euro currency, the process will be faster within 1 - 2 days with cheaper fee).

  • Step 3: The customer inputs the required information.
    • Beneficiary name (Name of the merchant or your company).
    • The purpose of payment (Please note your order details, such as order number, sender name… ).
    • International bank account number (IBAN) of the merchant.
    • Country that the customer wishes to send the money to.
    • Business identifier code (BIC) (if any).
    • Supporting documents (if any due to high volume of orders).
  • Step 4: The customer proceeds to payment, checks the invoice, and the transaction is completed.

The Single Euro Payments Area (SEPA) is a system of transactions created by the European Union (EU). The SEPA harmonizes the way cashless payments are transacted between Euro countries. People conducting business in these countries now make cross-border cashless payments at the same cost and convenience as domestic payments thanks to SEPA online payment method.

The SEPA is managed by the European Payments Council on a collaborative basis with the European Commission, the European Central Bank (ECB), and other European stakeholder groups.

There are 36 countries that participate in SEPA, which is a well-established home market area for making cross-border Euro bank transactions. It essentially makes international money transfers easier by making it equivalent to domestic transactions. This means that even if you’re transferring funds between two banks that are in different SEPA countries, you can enjoy a fast transaction and minimal transfer fee.

Name

Single Euro Payments Area.

Implementation year

2014 for Euro area countries.

2016 for Non-Euro area countries.

Currency

Euro (€).

Cashless payment instruments

Credit transfer, direct debit.

Speed of processing

No longer than 1 business day for electronic payment orders, 2 business days for paper-based payment orders.

SEPA area countries

36 countries (includes some non-euro area and non-EU countries).

Stakeholders

European banking and payments industry, payment service users, national governments, the European Commission, the Eurosystem, and several other public authorities.

Even if you don’t live in the SEPA area countries, you can still open a non-resident virtual bank account with an International Bank Account (IBAN) in Europe and be able to make Euro transfers without a fee if it’s an internal bank transfer (same bank), and small fee if it’s a transfer between different SEPA bank accounts.

IBAN (International Bank Account Number) is an internationally agreed system of identifying bank accounts across national borders to facilitate the communication and processing of cross border transactions with a lower chance of transcription errors. It was originally adopted by the European Committee for Banking Standards (ECBS) and afterwards as an international standard.

What is the SEPA format?

An IBAN consists of up to 34 alphanumeric characters comprising a country code, two check digits, and a number that includes the domestic bank account number, branch identifier, and potential routing information.

SEPA payment method allows customers to make cashless Euro payments to any banking account and anywhere as long as they are inside SEPA's supported territory. PayCEC launched its ready-made SEPA online payment gateway that enables merchants to access SEPA without any intermediary bank.

PayCEC offers the lightning-fast and most secure SEPA payment gateway with hassle-free integration for merchants to accept SEPA payments from customers' accounts in 36 SEPA countries and associated territories. Besides, PayCEC’s SEPA payment gateway fee is considered cost-efficient as it is lower than international bank transfers.

SEPA payment system uses the International Bank Account Numbers (IBAN). SEPA payment method with additional optional features or services such as mobile phone or smart card payment systems, are not directly covered. To pay by SEPA payment gateway, you only need to have the payee’s bank details in the international format. Most SEPA transfers arrive in the beneficiary’s bank account within 1-2 business days.

To make SEPA payments, you will need a PayCEC’s SEPA payment gateway and a IBAN (International Bank Account Number) number, which is an internationally agreed system of identifying bank accounts across national borders to facilitate the communication and processing of cross border transactions with a lower chance of transcription errors.

An IBAN consists of up to 34 alphanumeric characters comprising a country code, two check digits, and a number that includes the domestic bank account number, branch identifier, and potential routing information.

Even if you don’t live in the SEPA area countries, you can still open a non-resident virtual bank account with an IBAN in Europe, and be able to make Euro transfers without a fee if it’s an internal bank transfer (same bank), and small fee if it’s a transfer between different SEPA bank accounts.

For payee checkout input:

  • Name of the merchant or your company (Beneficiary name).
  • The purpose of payment (please note your order details, such as order number, sender name… ).
  • International bank account number (IBAN) of the merchant.
  • Country that the customer wishes to send the money to.
  • Business identifier code (BIC) (if any).
  • Supporting documents (if any due to high volume of orders).

Thanks to the Single Euro Payments Area (SEPA), you can pay with SEPA anywhere in the European Union, as well as a number of non-EU countries, other countries and territories which are part of the geographical scope of the SEPA Schemes.

27 Member States of the European Union (EU):

Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.

6 non-EEA countries, to which the geographical scope has been extended:

Andorra, Monaco, San Marino, Switzerland, United Kingdom, Vatican City State, Saint-Pierre-et-Miquelon, Guernsey, Jersey, Isle of Man.

3 countries of the European Economic Area (EEA):

Liechtenstein, Iceland, and Norway.

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About us

who we are

about us

We are honored to serve as your reliable business partner and financial service provider in the industry and other business-related services. With the help of our professional staff, to help merchants to achieve their goals for the development and expansion of the international business market.

Our payment flow has developed in the e-commerce world to perform seamlessly and effectively across all platforms and devices. We take pleasure in combining technology with customer service, to solve your concerns at the moment.

PayCEC is a fully worldwide payment network that not only allows merchants to be paid immediately and securely, but also allows them to withdraw money in multiple currencies to their company accounts.

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