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Payments, including credit transfers, and delays in cross-border payments
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Under EU law, bank charges for financial transactions should be the same within EU member states and between EU states. For example, if you withdraw money from your Irish bank account using an ATM in Germany the charge for this transaction should be equivalent to the charge you would pay if you withdrew the same amount using an Irish ATM which is not part of your bank network.
Regulation (EC) No 924/2009 deals with charges for cross-border and national payments in euro. It applies to payments in euro in all EU member states. The objective is to make sure that charges for equivalent national and cross border financial transactions in euro are the same.
The basic principle is that the charges for financial transactions offered by a payment service provider (your bank) must be the same, for payments of the same value, whether the payment is national (and not your own bank) or cross-border. You cannot be charged extra fees (for example, annual fees or once-off charges) for using your card in other EU member states.
The Regulation applies to all electronically-processed payments, including:
Some conditions may apply depending on the payment type. For example, for credit transfers and direct debits, you must use an International Bank Account Number (IBAN) and Bank Identifier Code (BIC) when ordering the payment.
The Regulation does not apply to cheques (mainly because the use of cheques is declining across the EU) and it does not apply to currency conversions to and from euro.
The Payment Services Directive (2007/64/EC) states that for cross-border transfers that do not involve a currency exchange (for example, euro transfers) that the money should be available by the end of the next business day. This can be extended by one business day if the transaction is initiated by a paper order. This Directive was transposed into Irish law by the European Communities (Payment Services) Regulations 2009.
The Single Euro Payments Area (SEPA) makes all electronic payments across the euro area as easy as domestic electronic payments within one country are now. The SEPA project is supported by the European Commission and the European Central Bank. SEPA is being implemented by 34 countries – the 27 EU member states (including countries which do not use the euro) plus the UK, Norway, Iceland, Liechtenstein, Switzerland, San Marino and Monaco.
To achieve this, a common set of payment instruments was developed, together with common standards and a legal basis for making payments across Europe fast, efficient and safe.
SEPA allows you to:
You cannot be obliged by a payer or payee to maintain a bank account in any particular country to make or receive payments. For example, an Irish person working in France could have their French employer pay their salary directly to their Irish account and use that account to pay direct debits and bills in France.
The main change is the way your bank and account is identified for making and receiving payments. You will need to use the BIC (Bank Identifier Code) and IBAN (International Bank Account Number) to identify your bank and account rather than the NSC (National Sort Code) and Account Number.
Individual consumers will be informed directly by their banks about any changes to their account terms and conditions arising from SEPA implementation.
From 1 February 2014 it became mandatory to retire existing ‘national only’ payment systems in the euro area and move all electronic payments to SEPA standards. For EU member states with other currencies than the euro the end-date is 31 October 2016 for all credit transfers and direct debits in euro.
The Payment Services Directive (which was transposed into Irish law as the European Communities (Payment Services) Regulations 2009 ) provides the legal framework for SEPA.
You can find out more about SEPA from the Central Bank of Ireland and the European Central Bank.
Having left the EU, the UK government has committed to keep its payment rules in line with SEPA.
In the event that the UK is excluded from SEPA in the coming years, there may be some additional costs for transfers in euro between accounts in the UK and accounts in the EU. Transfers may also take longer than you are used to.
You can find out more information in the Central Bank’s Brexit information document for Consumers.
If you believe that your bank is not charging you the same amount for national and cross-border payments you should contact them (preferably in writing) and ask for clarification and resolution of your problem.
If you believe that the rules of Regulation (EC) No 924/2009 have been breached, you should contact the Central Bank of Ireland or the relevant authority in the country where the problem occurred. (You can find a list of the national competent authorities. )
Alternatively, if your problem appears to be a bank error rather than the incorrect application of the Regulation rules, you may contact the Financial Services and Pensions Ombudsman in Ireland or the relevant national out-of-court redress body and ask them to mediate in the resolution of your dispute.