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SEPA implementation deadline extended

  • United Kingdom
  • Technology, Media and Telecoms



In a press release of 9 January 2014, the European Commission announced that it has adopted a proposal to give an extra transition period of six months during which payments which differ from the SEPA format can still be accepted. This is in order to minimise any possible risk of disruption to payments for consumers and businesses.


The SEPA Regulation (EC 260/2012), adopted in 2012,  aims to create an integrated euro payments market and the harmonisation of national and cross-border euro payment systems, both at a technical level and in terms of procedures and the customer experience, so that payments can flow quickly, simply and cheaply across the whole of Europe.

The SEPA Regulation  affects anyone  who makes a euro denominated electronic retail payment (i.e. a credit transfer or direct debit).

1 February 2014 had been set as the date by which businesses within the single euro payment area would need to begin processing payments in Euros using systems that conform to the SEPA Regulation. However, the deadline has now been extended to 1 August 2014. Explaining the decision, internal market and Services Commissioner Michel Barnier said:

“.... migration rates for credit transfers and direct debits are not high enough to ensure a smooth transition to SEPA despite the important work already carried out by all involved.

Therefore, I am proposing an additional transition period of 6 months for those payment services users who are yet to migrate. In practice this means the deadline for migration remains 1 February 2014 but payments that differ from a SEPA format could continue to be accepted until 1 August 2014”

So What?

To meet the 1 February 2014 deadline, anyone affected needed to upgrade their technology used to process payments or outsource the service to a service provider with compliant infrastructure in place by 1 February 2014. It was therefore anticipated that a wave of consolidation and outsourcing in the payment industry would be set off prior to February 2014. For that reason, this extension of the deadline, whilst a relief to those affected,  is likely to be unwelcome news for those outsourcing service providers who were hoping to gain business from any firms that needed to turn to an outsource processing service provider to comply.


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