Within the euro SEPA payments for 35 European countries are free. This is in contrast to SWIFT international payments which cost around €30 each. Recently we were talking to a customer who was sending SEPA payments but their bank was charging them €250 a day. You ask how is this possible? .
The difference in fees
Banks make no money from sending SEPA payments as the fees are usually free or at minimal costs for businesses of 10 cents to 50 cents. For example when a person or company in Spain sending a Euro payment to Germany the cost is free due to SEPA. BUT surprise surprise , lot of banks force their customers to send SWIFT payments or Wire transfers, charging €30 per transfers. Not only is this costly and unfair but it will take longer than SEPA payments. Lot of european accounts are only SEPA enabled (like the B2B Pay accounts) these transfers will be rejected by the receiving account leading to the payment bouncing back to the sender.
We would love to give a guide to make sure that users dont send SWIFT payments by mistake but unfortunately we cannot do this as every european bank has a different online setup . but a few checklists you can follow.
If you are sending payments which is euro to euro. From/to any of these 35 European countries then it is a SEPA payment.
Checklist to insure that you are not making a SWIFT payment by mistake:
- 1) Make sure you make the payment from a Euro account to a Euro account
- 2) If you see a large fee being charged (€10-40, then for sure it is a SWIFT payment! Either talk to your bank about this or see if there are any other options in your online banking portal
- 3) Words like SWIFT; SHA, OWN should be a red flag.
- 4) If it asks you for an address most likely it is SWIFT.
Your B2B Pay account is for the Euro currency and SEPA enabled. This means that it can receive euro payments from 35 European countries.
What is the difference between SWIFFT and SEPA?