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Montenegro and Albania join SEPA payment systems
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Montenegro and Albania join SEPA payment systems

Montenegro and Albania have joined the geographic scope of the Single Euro Payments Area (SEPA) payment systems, the board of directors of the European Payments Council (EPC) has announced.

The accession of Montenegrin and Albanian financial institutions to the SEPA payment systems, according to the EPC schedule, will be allowed from April 2025.

The Operational Readiness Date (ORD) for Payment Service Providers (PSPs) of Montenegro and Albania will be communicated later by the EPC.

SEPA ensures smooth cross-border transactions in euros

Participants in the EPC payment system can now send and receive SEPA Credit Transfers (SCT), SEPA Instant Credit Transfers (SCT Inst) and SEPA Direct Debits (SDD) with participants in Montenegro and Albania, once their financial institutions have joins the programs. SEPA payment systems now cover 38 countries.

The SEPA (Single Euro Payments Area) payment system is a European initiative that simplifies and standardizes electronic payments in euros in participating countries. It ensures that cross-border euro transactions, such as transfers, direct debits and card payments, are as transparent, efficient and cost-effective as domestic payments within any member country.

  • Key features include:
    Standardized formats: Payments use IBAN and BIC codes, ensuring uniformity.
  • Transactions in euros only: SEPA exclusively concerns payments made in euros.
  • Scope: It includes 36 European countries and territories, now plus Montenegro and Albania, making it 38.

The program is managed by the European Payments Council (EPC) and aims to foster integration and economic efficiency within the euro area and beyond.

Before Albania and Montenegro joined the SEPA payment system, the most recent additions were Andorra (joined in March 2019) and San Marino (joined in March 2014). Both countries joined SEPA after the initial launch, which included EU member states Iceland, Liechtenstein, Norway, Switzerland and Monaco.

PSPs must enable instant payments for their customers

Recent developments in Single Euro Payments Area (SEPA) payments include several regulatory updates and technical transitions that are reshaping the European payments landscape.

Mandatory SEPA instant payments: From January 2025, Eurozone payment service providers (PSPs) must enable instant payments for their customers. The deadline extends until October 2025 for sending these payments. These changes also require PSPs to introduce enhanced payer-payee verification mechanisms, for example ensuring that the payee name matches the IBAN. Instant payments will be capped at €100,000 per transaction, with the ability for customers to set individual limits.

Transition to ISO 20022 standards: SEPA systems adopted the 2019 version of the ISO 20022 messaging standard by March 2024. This change introduced an improvement in data quality and payment processing efficiency, meeting thus to the evolution of global payment needs. Payment institutions must adapt their systems to comply with these updated guidelines, ensuring transparent operations and better integration with international payment systems.

Operational adjustments: Institutions should modernize their IT systems to support 24/7 availability for real-time payments and implement new name verification services. Simplified sanctions control protocols are also being introduced to facilitate compliance processes.