A new set of rules requiring payment service providers (PSP) to guarantee real-time processing of credit payments across all EU member states and non-eurozone countries took effect.
As of January 9, 2025, all payment providers within the European Union must ensure that incoming credit payments are processed within ten seconds. This requirement is part of the Instant Payments Regulation (IPR), which was previously approved and is now being implemented.
A credit transfer is a bank transfer initiated by the payer, while in a direct debit, the recipient typically initiates the transaction.
The regulation, adopted on March 13, 2024, focuses solely on credit transfers with the following objectives:
- Encouraging widespread adoption of instant euro credit transfers within the EU.
- Establishing uniform rules for instant transfers, eliminating fragmented national approaches to regulation.
- Enhancing financial security through mechanisms such as recipient verification and daily client screening against sanction lists (targeted financial restrictive measures).
New client screening requirements for banking PSPs within the EU and beyond also took effect on January 9, 2025. Moreover, a rule was introduced to ensure that fees for instant transfers in the eurozone can’t exceed those for standard transfers.
The next phase of the IPR implementation, requiring the capability to process outgoing payments within the EU, will come into force on October 9, 2025. For banks and PSPs outside the eurozone, as well as non-bank payment and e-money organizations within the eurozone, receiving and sending instant credit transfers and complying with fee requirements will become mandatory by 2027. The final deadline for implementing the IPR is June 9, 2028, covering instant payments sent outside of working hours from accounts denominated in EU member states’ national currencies.
In 2024, bank cards were the most significant payment instrument among Europeans, accounting for 45% of all payments in the eurozone by value.
