The purpose of SEPA is to achieve simple and standardised euro payment flows in Europe. Companies will be able to send and receive cross-border payments as if they were domestic payments.
For the company, SEPA may lead to:
Lower processing costs - the possibility to process all euro payments within EU/EEA in a common way
A uniform process for all incoming and outgoing payments, domestic as well as cross-border
Uniform conditions for all euro payments
Changed pricing - during the next years, the prices for euro payments are expected to sink
More efficient liquidity management - cash flows and liquidity planning can be improved by centralisation
Increased opportunities to automate payment flows
To classify a euro payment as a SEPA payment, a standardised account number (IBAN) and a bank identifier code (BIC) are required. If the payment can not be classified as a SEPA payment, it will for now be processed as an ordinary cross-border payment. The effect of an incorrect IBAN is that the payment will be rejected and possibly be charged for.
