EU Council Adopts Instant Payments Within 10 Seconds

Learn how the EU Council's adoption of instant payments within 10 seconds enhances efficiency and innovation in financial services.

The European Council has taken a significant step towards enhancing security measures for instant payments and improving cash flow mobility and innovation in financial services. The adoption of a new regulation mandates the availability of instant payments in euro across the European Union and European Economic Area countries, allowing intra-EU transfers to be completed within 10 seconds.

This regulation is aimed at consumers and businesses, with the goal of reducing dependency on financial institutions and infrastructures outside the EU. The provision for instant transfers of money will enable transactions to be completed within 10 seconds at any time of the day, including outside of traditional business hours. This service will not only be available for domestic transfers but also for cross-border payments within EU member states, taking into consideration the specific needs of entities in non-euro areas.

Under the new regulatory framework, banks and payment service providers offering standard credit transfers in euro will now be required to provide the option for instant payments in euro. Fees associated with instant payments should not exceed those applied to standard credit transfers, ensuring fairness and accessibility for users. The implementation will be phased, with a quicker transition period for euro area countries and a more extended adjustment period for non-euro areas to accommodate varying capacities.

The regulation also enhances the operational framework for payment and e-moneyinstitutions by modifying the settlement finality directive. This adjustment ensures that these institutions are included in the mandate to offer instant credit transfer services post-transition, with specific safeguards in place to prevent additional risks to the payment system. Security measures for instant payment transactions will be enhanced, requiring providers to verify the match between the beneficiary’s IBAN and name to alert payers of potential errors or fraudulent activities before completing a transaction.

The new regulation adopted by the European Council marks a significant milestone in enhancing security measures for instant payments and improving cash flow mobility and innovation in financial services. The availability of instant payments in euro across the EU and EEA countries will provide consumers and businesses with faster and more secure transaction options, reducing dependency on external financial institutions and infrastructures.