10 things consumers need to know about SEPA

1 The big idea: SEPA will standardise euro payments across Europe, making money transfer more efficient and cheaper. In total, there are 33 countries in the SEPA area. These are the existing 28 EU member states of the European Union, together with Iceland, Lichtenstein, Monaco, Norway and Switzerland.

2 What will we notice? The current system of using national bank account and sort code numbers for transfers and direct debits will disappear on February 1st. These will be replaced by IBAN and BIC codes. These numbers can be found on your recent bank statements.

3 When will changes be made? Most businesses have already started the changeover , including your employer. You may be asked for your BIC and IBAN instead of your bank sort code and account number. If you make direct debit payments today, these will continue. You will likely be notified by the direct debit creditor when they start processing your payments under the SEPA direct debit scheme.

4 One SEPA, one bank account: Once SEPA has been fully implemented, consumers will need only one bank account to make and receive euro-denominated payments to and from anywhere in the area. For example, an Irish holiday-home owner with an apartment in Spain who needs to make regular payments to a Spanish utility could make these payments by direct debit from their Irish bank account, rather than needing to open a Spanish bank account.

5 Do I need to change all my direct debits? No, the transition to SEPA should be seamless for consumers who currently have direct debit arrangements in place with their banks for regular payments such as utility bills or mortgage repayments. Existing direct debit mandates will remain valid in the SEPA environment – although the payees collecting payments via direct debit will need to make changes to their internal systems and processes to cater for the new regime, the payers do not have to take any specific action in this regard.

6 How will it benefit consumers? The new payments system will enhance consumer rights. Banks are required to provide a "no questions asked" refund of direct debits within an eight-week period. Under traditional arrangements, consumers have needed to provide a justification for such requests.

7 Faster and simpler payments: The Payment Services Directive obliges payment service providers to process payments within certain time limits (one business day for electronic payment orders, two business days for paper-based payment orders). A long-term goal of SEPA is to eliminate paper and use electronic payments only.

8 More functionality Payers (consumers and businesses) will also be able to send longer messages to the payee (up to 140 characters). You will notice changes to your bank statements and online/mobile banking to accommodate this.

9 Wider use of payment cards: Consumers can use their payment card in any country in the payment area in the same way they use it in their home country. A SEPA- compliant bank card must have the potential to be accepted at ATMs and/or by merchants in all participating countries.

However,it is the decision of the individual merchant, a supermarket for example, which kinds of bank cards they accept and process for payment. In limited instances, therefore, it might happen that a bank card cannot be used to pay at an individual retailer .

10 Handy too . . . The Irish Payment Services Organisation has a very useful tool on its website that shows you your IBAN and BIC. You simply input your traditional bank sort code and account number and it will instantly translate these into the new bank codes that you will need to use. You can find this at ipso.ie