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SEPA Instant Credit Transfer: a new era in B2B2C payments

The emergence of instant payments has been a gamechanger, with its 24/7/365 nature revolutionizing the payment & treasury ecosystem. Banks have adapted to rising consumer expectations and inherent regulatory changes, both in terms of standardization and swift processing, all while compliant with regulatory affair controls.    

 

Retail consumers in Europe and other regions were the first to drive these changes by adopting digital and secure real-time solutions as an alternative for cash and as another standard requirement for accessing commercial and financial markets. Card payments or instant Account-to-Account (A2A) payment schemes like BIZUM in Spain or BLIK in Poland provide users with an immediate update and confirmation in contrast to the traditional batch processing of payments during or at the end of each business day. The deployment of alternative, instant payment solutions has been evolving ever since entering also the B2B space. 

 

The SEPA Instant Credit Transfer (SEPA Instant) regulation in Europe was first launched back in 2017, but its obligatory implementation for banks across the 27 EU member states starts on January 9, 2025, for reception, followed by October 9, 2025 for the issuance of instant euro payments. For other Payment and Electronic Money Entities the adoption deadline expires on April 9, 2027.   

 

This is part of a wider effort to bring the euro payment landscape up to speed, given that nowadays, the share of instant payments in Europe is still low compared with other global regions where India and Brazil dominate the real-time payments market by volume. The forecast for Europe is that instant payments will account for 13% of all electronic payments in 2028 up from 8% in 2023.  
 


 

How can multinational corporates benefit from the SEPA Instant implementation? 

 

The operational and strategical long-term advantages of instant payments are substantial for corporate clients across the SEPA countries:

 

Enhancement of liquidity management and cash flows 

  • Faster collections and the immediate availability of funds will enable faster treasury operations and reduce liquidity constraints by optimizing cash forecasting and management. 
  • Improved cash conversion cycles of receivables and payables, leading to quicker access to working capital.

Operational efficiency

  • Secure and verified 24/7 payment processing outside of traditional banking hours and across time zones.
  • A faster reconciliation of traceable processes, reducing operational queries.

Operational costs

  • Real-time access to funds reduces reliance on costly short-term financing solutions, reducing interest expenses.
  • Charges applied on instant payments cannot exceed those applicable for regular SCTs.

Competitive advantage 

  • Strengthens the relationship and enhances the trust and experience with customers and suppliers through a more rapid settlement of refunds or payments.

Where does Santander CIB come in?

 

At Santander CIB, we are driving innovation by bringing forward a wider range of payment methods and schemes to our multinational corporate clients, to allow for a more efficient allocation of resources and better cash management practices. 

 

We support the application and timeline of the SEPA Inst scheme in the Eurozone, which enables the instant transfer of euro payments from one payer account to that of a payee within 10 seconds, at any time, on any day (24/7/365). 

 

The scheme applies to payers issuing payments in euros from any currency account, between accounts inside the SEPA Eurozone. The current limit for retail instant payments is €100,000 but banks can eventually raise this for corporate users to make the scheme even more attractive.

 

MONICA ROMAN, Head of Payment Solutions at Santander GTB Europe: "We have faced an ambitious project to connect all our European Units and their payment channels to SEPA Instant. It will be the foundation stone for forthcoming value-added products for our customers. We are proud of our support for multinationals in these important areas, advising them on how to best create the standards for instant payments within their respective operational framework, sectors, and markets."

 

LAUREANO RUBIN DE CELIS RODRÍGUEZ, Head of Cash Management Sales at Santander GTB in Spain: "Santander in Spain was the first group unit to activate SEPA Instant payments after the official launch of the scheme. In recent years, our multinational corporate clients have found a way to unlock their value by optimizing their cash flow through the immediate availability of incoming funds."
 

 

Author: Ute Stammeyer, Head of Cash Management Advisory Europe at Santander Group.
 

For further questions, please contact the Cash Management Advisory Team in Europe (cashadvisory@gruposantander.com)