Updated
GL-S-05
Glossary · Banks and finance
SEPA - euro transfers across Europe as if within one country
01 / In 30 seconds
The short answer
- What it is
- A single euro payments area within Europe
- What it gives
- Euro transfers under the same rules and usually cheaper than SWIFT
- Currency
- Euro only — other currencies use SWIFT
- Timelines
- A normal transfer usually takes 1 business day; an instant one, seconds
- What is required
- The recipient’s IBAN, sometimes the BIC
02 / In plain words
What SEPA means
SEPA (Single Euro Payments Area) is a single area for payments in euro. Put simply: within this area, transferring euro from one country to another works as simply and cheaply as a payment within your own country. It works only for euro — for dollars, pounds and other currencies the usual SWIFT is used.
The area includes EU and EEA countries as well as a number of states beyond them. The recipient’s IBAN is enough for a transfer; some banks also ask for the BIC. A normal transfer (SEPA Credit Transfer) arrives the next business day in most cases, and an instant one (SEPA Instant) in seconds, including at weekends.
For clients obtaining residence or citizenship in Europe, SEPA is the main channel for everyday settlements: rent, bills, lawyers’ fees, state fees in euro. At the same time, large payments within SEPA go through the same compliance as any other: the network’s speed does not remove the bank’s questions about the source of funds.
A case from practice
A family is obtaining residence in Europe: rent, school, lawyers, state fees — all in euro. We help open an account within the SEPA area, and everyday payments go through within a day and almost free of fees, instead of expensive transfers from another jurisdiction.
When you will encounter SEPA
- Paying for services and fees in euro
- Renting a home in Europe
- Settlements with lawyers and a notary
- Regular subscription payments
- Transfers between your own euro accounts
- Receiving a salary in the eurozone
03 / What it covers
What you need to know about SEPA
Conditions
- Euro only
- Usually cheaper than SWIFT
- A fee like a domestic payment
Bank details
- The recipient’s IBAN
- Sometimes the BIC
- The account holder’s name
Types of payment
- A normal transfer
- An instant transfer
- Direct debit
Restrictions
- Other currencies — through SWIFT
- Compliance still applies
- Limits depend on the bank
04 / How it works
How a SEPA payment works
Take the recipient’s IBAN
The IBAN from the invoice or contract, and the BIC if needed.
State the payment reference
The invoice or contract number and what the payment is for.
The bank checks the payment
Large sums go through compliance like any other payment.
Credited in euro
Usually the next business day; an instant transfer takes seconds.
Transaction confirmed
We keep the confirmation for accounting or the programme.
05 / Key facts
What you need to know
01What it is
A single euro payments area
A transfer between member countries follows the same rules and costs about the same as a domestic one.
02Currency
Euro only
Dollars, pounds and other currencies are sent via SWIFT.
03Timing
Usually 1 business day
A SEPA Instant transfer takes seconds, including at weekends, if both banks support it.
04Checks
Compliance still applies
The bank may stop large or unusual payments and ask for the basis and source of the money.
Common mistakes
Sending non-euro currency via SEPA
Use a SWIFT transfer for other currencies.
Expecting SEPA to skip the bank's checks
Prepare documents for large payments, just as for SWIFT.
Leaving out the payment reference
Give the invoice or contract number and what the payment is for.
06 / Expert advice
How to prepare in advance
For regular expenses in Europe it is convenient to keep a euro account within the SEPA area: it is noticeably cheaper and faster than international transfers. For large payments, confirm your bank’s limits in advance and prepare supporting documents — an invoice, a contract, a programme letter. The network’s speed does not exempt you from compliance.
What we do for you. We help set up payment logistics for your programme: where to keep a euro account, which payments to make via SEPA and which via SWIFT. This saves on fees and removes most delays with regular expenses.
Dmitry NagyTax consultant, international taxation and compliance (ex-Big4)
07 / Questions
Frequently asked questions
It is a single area for payments in euro: a transfer between countries in the area goes through on the same rules and at about the same price as a domestic payment.
No. SEPA works only with euro. For other currencies an ordinary international SWIFT transfer is used.
A normal transfer usually arrives the next business day. An instant one takes seconds, including at weekends, if both banks support it.
The IBAN is often enough, but some banks still ask for the BIC. Go by your bank’s form.
Yes. Compliance does not disappear: for large or unusual transactions the bank may ask for the basis of the payment and the source of funds.
EU and EEA countries, as well as a number of states beyond them. The current list is published by the European Payments Council.
INITIAL ASSESSMENT
Tell us what outcome your family needs
We will design a solution for your case, choose the country and the right status, and take the whole process through to the result.
