SEPA: Challenges for Financial Institutions - A Financial Institution Perspective

Abstract
It all started, in 2002, with a vision to create a Single Euro Payments Area - or SEPA by the European Central Bank (ECB). According to the ECB, “the payments infrastructure of each euro area country developed originally in order to serve the needs of the individual country.

The introduction of the single currency created the need for a euro area-wide integrated infrastructure. National borders no longer matter, and there is no difference between a 'domestic' and a 'crossborder'euro payment. But cross-border retail payments are still more costly than national ones. A pan-European payments infrastructure is still evolving. Due to the original domestic focus the intersection between the national payment systems is inefficient and creates high costs for the banks”. This paper discusses the challenges for a financial institution for addressing SEPA requirements and mitigation processes.

Author Debgiri Sanyal Vivek Patil

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