# SEPA deadline February 2014. What can we expect?



## murphaph (27 Apr 2013)

So, as the deadline for full implementation of the SEPA protocols fast approaches, what will we be able to do differently in a year's time?

My day to day banking is done where I live, in Germany, all online and all free. Haven't been to a branch in years.

I rent some property in Ireland and have a single outstanding mortgage there, so up until now I've needed an account to lodge rent into and with which to service the mortgage.

In theory this should all change by February at the latest, if I understand SEPA correctly. The idea is that national sort codes and account numbers will become defunct and all payments to accounts will be made via IBAN/BIC.

Given this, I hope to be able to close my one remaining Irish account and instruct tenants to use an IBAN/BIC for a German account and ALSO to instruct my mortgage lender to use same. In theory the lender must accept the new IBAN/BIC as far as I understand the rules and to the tenant paying into an "Irish" IBAN or a "German" IBAN numbered account is exactly the same.

Some state institutions here in Germany have already switched and you can no longer pay them via anything other than their IBAN/BIC.

Will Irish financial institutions honour this? Will they have any choice? Interesting times ahead (for residents in Ireland too the idea would unshackle them from often incompetent and lackadaisical Irish banks and allow them to open current accounts elsewhere).

Will anyone else here look to open non-Irish accounts for their day to day business?


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## Nermal (27 Apr 2013)

I haven't seen any requirement in SEPA that an Irish company would have to accept non-Irish IBANs.

It certainly goes against the spirit of SEPA but might not be against the law...


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## Jim2007 (27 Apr 2013)

SEPA rules define how banking transactions are executed, it does not define how individuals conduct their business.  Changes to the payment instructions in a contract will still have to be agreed in the normal way, not unilaterally.


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## murphaph (27 Apr 2013)

Thanks guys. Sounds less than inspiring then.

So much for the "common market" we were promised in the early 1970's.

I had a little read of the Central Bank's migration to SEPA guide and they state:


> "SEPA and consumers:
> In a SEPA environment, consumers can rely
> on just one bank account and one payment
> card to make and receive euro-denominated
> ...


Does this not imply the reverse, that if I wish to pay an Irish utility company/bank etc. from a German account that I will have that choice?


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## STEINER (27 Apr 2013)

murphaph said:


> Thanks guys. Sounds less than inspiring then.
> 
> So much for the "common market" we were promised in the early 1970's.
> 
> ...




I did an online bank transfer from my Irish AIB personal current account to a German bank account recently.  It was easy and free of any bank charge for me anyway.  They acknowledged my payment the following day.


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## Jim2007 (27 Apr 2013)

Yes, but this refers to you as the payer *not* the recipient, which is different to what you were proposing in your original post.  

If your mortgage agreement says that you must maintain an account with the bank and use it to service your mortgage, then that is what you must do unless you come to some other agreement with the bank.  Similarly if your rental agreement the states that the tenants are to pay the rent into a certain account, then you need to get their agreement on the change.  This in no way stops anyone from using SEPA to make the payments, but the rules do not in any way over rule contract law.

The other thing to keep in mind is confidentiality implications of having everything coming into a single account.  It is far simpler to have an account where you are just dealing with the rental related business and show that to your bank, tax inspectors or whoever, rather than having to show them your entire financial situation... you never know what else they might become interested in, if you get my drift ;-)


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## murphaph (27 Apr 2013)

Hi Jim, yes I see what you meant now. I have a clause in my rental agreements that the payment method may change from time to time so that side is fine. I haven't gone through my loan agreement to see if I can nominate another account for servicing the mortgage...I'll do that and see if I can get the bank to accept another (I was going to do this anyway as UB are introducing fees and I could more easily avoid fees with PTSB or minimise them with BoI).

I would of course open other rent only accounts (they are foc here anyway) with my German bank to have tenants lodge to, I wouldn't "mix" the money or anything. To messy from my own perspective


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## murphaph (27 Apr 2013)

STEINER said:


> I did an online bank transfer from my Irish AIB personal current account to a German bank account recently.  It was easy and free of any bank charge for me anyway.  They acknowledged my payment the following day.


Yes, I've been doing payments like these monthly for years and they are fine but I'm talking about using foreign accounts to have Irish sourced Direct Debits drawn on.


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## Lightning (27 Apr 2013)

Nermal said:


> I haven't seen any requirement in SEPA that an Irish company would have to accept non-Irish IBANs



Interesting point. However, I have not heard of any SEPA implementation so far that restricts customers to domestic IBAN codes. Have you?


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## Lightning (27 Apr 2013)

murphaph said:


> Interesting times ahead (for residents in Ireland too the idea would unshackle them from often incompetent and lackadaisical Irish banks and allow them to open current accounts elsewhere).?



+1.

It is going to be very interesting to see if/how many pan European web based current account products spring up post 1 February 2014 and if they will offer debit cards. 

Options like KeyTrade become a more viable current account alternative, for Irish residents, post 1 February 2014.


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## Jim2007 (27 Apr 2013)

CiaranT said:


> +1.
> 
> It is going to be very interesting to see if/how many pan European web based current account products spring up post 1 February 2014 and if they will offer debit cards.
> 
> Options like KeyTrade become a more viable current account alternative, for Irish residents, post 1 February 2014.



I expect many people will be disappointed with the offerings, espically with online banking and debit cards... It is not at all unusual for it to take two or three working days to load money on a card for starters!


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## murphaph (27 Apr 2013)

Jim2007 said:


> I expect many people will be disappointed with the offerings, espically with online banking and debit cards... It is not at all unusual for it to take two or three working days to load money on a card for starters!


My current German bank, DKB (though not interested in non-German speakers from what I gather) has a great product.

I have a current account with VPay card and a linked Visa (credit) card.

I can withdraw cash at ANY ATM in the world bearing the Visa mark for free. The bank will even refund those charges from "private" ATMs that you often see in the states, if I forward them the slip the ATM printed out.

On the 22nd of each month the entire credit card balance is taken from the current account and everything resets. I pay no interest on the cash I withdraw at an ATM using the visa as this id the way the account works-you are supposed to use the visa for ATM withdrawals. 

When I log in to the online banking it shows me a summary of ALL transactions (including credit card) and shows me how much money I "really" have altogether. 

I use my VPay (debit) card in shops in Germany only because many German retailers won't accept credit cards still. That's the only reason the bank issues the debit card. It's not to be used at ATMs (actually there's a hefty €10 fee to prevent you doing it!) because my bank is not part of any ATM alliance (like Link or whatever in the UK) and in Germany you still pay if you use the "wrong" ATM group to withdraw cash.

There are other similar offerings from Comdirect and IngDiba. These products are far superior to anything offered by an Irish bank and are FREE! I assume there are similar offerings in the Netherlands and other places.

Edit: the Central Bank Guide can be found here:
https://www.google.com/url?sa=t&rct...FsdZ2_B35IBXc0F4LIFWeiA&bvm=bv.45645796,d.bGE


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## Connard (27 Apr 2013)

That isn't really far superior to what you get in Ireland. I get all that bar free worldwide withdrawals (mine is only free in the EuroZone). I don't get charged for using my debit card in an ATM but would if I used my credit card so same difference.


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## Lightning (28 Apr 2013)

There are some good current account products available in other Eurozone countries like those mentioned above. However, the reality is that very few of these products will be offered to non-residents post full SEPA introduction. 

The open question is which banks, if any, will open new account applications, post SEPA, to all Eurozone citizens. If the flood gates open then serious current account product competition begins.


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## murphaph (28 Apr 2013)

Connard said:


> That isn't really far superior to what you get in Ireland. I get all that bar free worldwide withdrawals (mine is only free in the EuroZone). I don't get charged for using my debit card in an ATM but would if I used my credit card so same difference.


Which bank in Ireland post July this year will offer a no strings attached current account? Answer: none (unless you have some legacy PTSB account that they haven't (yet) changed the T&Cs on.

There is (post July this year) no bank in Ireland which I can walk into and open a no strings attached free current account.

No bank in Ireland (post July) will allow you to make ATM withdrawals or most any other type of transaction for free unless you meet their conditions (minimum balance, minimum lodgement amount etc.)

Oh I forgot to mention. My bank currently pays 0.2% on the current account and 1.05% on the visa. They encourage you to move money to the visa account (you are not liable for fraudulent use up to the value of your credit, as you would be with many standard Irish credit cards) and just maintain the minimum required to cover your direct debits and debit card usage. 

I don't use it as a savings tool as I get better rates with rabodirect.de but it's nice that my current account is paying the 0.2% for sure.

My bank's online portal is also superior to any I've used in Ireland (I've used AIB and UB). I can even upload insurance policies etc. to my online banking so in the event of a fire I have a copy of such things stored safely on the bank's servers. Nice touch.

I can also export my statements in CSV or XLS format. AIB certainly don't have that (UB allow CSV export IIRC). I also get cashback on purchases with many popular online retailers if I navigate to their site through my internet banking (usually 5%-10% cashback). It's just a far better level of service and all free.


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## murphaph (28 Apr 2013)

CiaranT said:


> There are some good current account products available in other Eurozone countries like those mentioned above. However, the reality is that very few of these products will be offered to non-residents post full SEPA introduction.
> 
> The open question is which banks, if any, will open new account applications, post SEPA, to all Eurozone citizens. If the flood gates open then serious current account product competition begins.


I think IngDiba might. They are Dutch and offer online accounts to Germans (in German) already. A bank like them could easily create an English language portal that would be attractive to many even non-native English speakers.


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## Connard (28 Apr 2013)

murphaph said:


> Which bank in Ireland post July this year will offer a no strings attached current account? Answer: none (unless you have some legacy PTSB account that they haven't (yet) changed the T&Cs on.
> 
> There is (post July this year) no bank in Ireland which I can walk into and open a no strings attached free current account.
> 
> ...



Yeah, I'm on a legacy PTSB account. The new PTSB account offers everything I get and it will give you 1% interest on your account balance. You do need to lodge €1500 a month into it if you want to avoid fees of €12 a quarter but that is easy to do just lodge and withdraw money until you get the €1500 if your wages don't cover it.

Don't get me wrong you have a good setup where you are but it's not vastly superior to what PTSB offer. The problem here is people seem reluctant to move so they sit where they are getting ripped off with fees.


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## murphaph (28 Apr 2013)

You're dead right there. People need to switch or they'll keep being ripped off. If folks moved to PTSB then the other banks would need to offer something better to win customers back. This inertia greatly benefits the banks.


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## Lightning (11 May 2013)

On a semi-related note ...

There is a new separate set of proposals with the EC at the moment. The proposals would allow anyone from any EU country open a current account in any other EU country. i.e. banks cannot restrict current accounts to domestic residents. 

The other proposal is to have a pan European switching code to replace the domestic switching code. 

Big steps forward that will have big effects on current account competition. This proposal and SEPA surely mean that web-based pan-European current accounts are now only a matter of time.


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## murphaph (11 May 2013)

Great news for all. Who said the EU never did anything for us?! The sooner AIB and their ilk across Europe face the harsh wind of customer focused competition the better. Europe really doesn't need as many banks as it has and I read in some report that just moving capital around Europe costs 2% of GDP! SEPA will go a long way towards addressing that issue.

I wonder how a conservative German bank will handle the new rules when applications come in from outsiders. Some products (like my DKB current account) are tied to a credit card and you need to have a good credit score (SCHUFA) in Germany to be considered. How will they not discriminate against someone from say, Bulgaria who may not have any credit record the bank can access? I think it's time that credit score systems across the continent were unified tbh.


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## Lightning (13 May 2013)

Great news indeed. The EU/EC proposal does not cover pan-European credit cards. Debt products will not be obliged to be open to all European residents.


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## Brussels (13 May 2013)

The SEPA Regulation 260/2012 Article 9 clearly states that a payer or payee cannot specify the member state in which a payment account is to be located. It is open to have your salary paid into and direct debits collected from an account in any member state.   
To insist that a salary or DD must be paid into / from an Irish bank account is breaking the law.   

　​


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## Lightning (13 May 2013)

Brussels said:


> It is open to have your salary paid into and direct debits collected from an account in any member state.



In theory. 

In reality, the vast majority of Eurozone banks don't allow non-residents open accounts from a different member state. Which is why further legislation is needed post SEPA implementation which the EC are working on.


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## murphaph (13 May 2013)

I think this will add significant strength to the eurozone as banks won't be so tightly aligned with individual national economies. More of a spider's web than a collection of individual entities as we have now. It's probably the only way the euro can survive really, through more about integration.


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## ardmacha (14 May 2013)

> The EU/EC proposal does not cover pan-European credit cards



While I don't aspire to debt, a credit card with frequent flyer points would be nice and these are readily available in other Euro states.


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## pudds (28 Jul 2013)

> At RaboDirect we plan to be Single Euro Payment Area (SEPA) ready by the 9th of September 2013
> 
> if you've got a Rabo Money Mover set up to deposit into your  RaboDirect account regularly, and the amount is in excess of €500 per  month or €100 per week, then you'll need to reduce this. Otherwise, your  payment request made on or after the 9th of September 2013 will not be processed if it exceeds either €500 per month or €100 per week


I only have an on-line demand account, so is there anything I need to do right now in advance of this or can I just wait till I'm making a deposit or withdrawal, and generate an iban code then.



Generate a new code: https://ipsosepaservice.sentenial.com/ipso/


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