SEPA – Single European Payment Area


At this moment in my office, I am accompanied with an IT Tester. She comes from India’s north and more talkative. A lady with gorgeous looks and open to talk on multiple topics makes sweeter days. She is of that kind.

She was talking to me about SEPA, couple of weeks back. I am not aware of the SEPA concept. She said – she did work in SEPA. But this time, she did not get deep dive into the topic. One of my client partners was asking help in SEPA testing. It was obvious for me to think about this lady.

We went for a coffee. She started speaking about SEPA. But this time too, it was simple and short. My brain wanted to know more about SEPA. SEPA is an idea of European Union. This Initiative aims at easy bank transfer across countries. SEPA is an abbreviation of Single European Payment Area. The initiative will help free flow of Euro through the union. SEPA contains 28 EU Nations and four EFTA nations.


While EU stands for European Union, EFTA stands for European Free Trade Association. EFTA nations operate in parallel but in link with EU. The EFTA nations are Iceland, Norway, Switzer land and Liechtenstein. There is one nation which enjoys the initiative of SEPA but not part of EU or EFTA – that is Monaco (This makes me remember the biscuit brand in India).

The Initiative mainly appears to eliminate the overhead on money transactions, which can be reduced at the max 2 pct of GDP of the union. Pan-European payments can widen the horizons for the EU brand within the Union.SEPA is most successfully implemented in European major banks.


The First milestone was- Implementing Pan-European payment.It was delayed. Most government initiative plunges into delays. The time line of 2008 for the Pan-European payment became reality in the year of 2009, November.

There was a clear cut objective, otherwise the second milestone called increasing efficiency through consolidation and scale of economy. Seems she was part of this testing in a leading EU bank when the bank started implementing SEPA.

There are three kinds of payment we make, when we do online transactions. The first one is Direct Debit, similar like India’s Electronic Clearance Service (ECS) – automatic transfers may be based on your calendar settings with the bank. It is called as PAP (Pre-authorized Payment) or PAD ( Pre-authorized Debit) by few. My house rent and Electricity were direct debits when I was staying in United Kingdom. SEPA in Direct Debit is reality from 2nd the November of 2009.This is called as SDD (SEPA Direct Debit).

The other one is Credit Transfer or Wire transfer. The most often way used to send money from an account of bank to other. This is called as SCT (SEPA Credit Transfer).

The third option we would use is Cards Transaction for buying. This is part of SEPA Cards Framework.

Last night after a big party bash, I met an Android developer who is working with HTML 5 in implementing SEPA for financial institution or a bank in EU. He was explaining about the memory stacks, leaks and implementing SEPA using HTML 5. I was thrilled to speak to him about the challenges he faced and the issues he resolved. But he was busy speaking to girls. But seems his timelines are in green and he is not yet ready to miss the timeline. He said – I am not government; A true word.

Not sure, when the Dream of Common Currency for SAARC will become reality.


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