EU Mandates Real-Time Payments, Enhancing Security and Speed
European banks must enable real-time euro transfers by January 9, 2025, with outgoing real-time payments becoming mandatory by October 2025.
Banks across the European Union are now required to facilitate the reception of real-time euro transfers, effective January 9, 2025. By October 2025, they must also be capable of sending funds in real-time.
These new regulations ensure that real-time transfers will reach the recipient within 10 seconds, operating 24 hours a day, seven days a week, throughout the year. The fees for these instant transactions will not exceed those of standard bank transfers.
Furthermore, a new IBAN-matching system will verify payee details against the provided IBAN before every transaction. This process aims to prevent errors and deter fraud attempts.
The IBAN matching involves a query from the payer's bank to the recipient's bank. The recipient's bank responds with a 'match,' 'no match,' or 'close match.' If there is no match or a partial match, the payer receives a warning and can then decide whether to proceed with or cancel the payment. This entire verification step is designed to take no longer than five seconds.
These enhancements are expected to increase the security of payment transactions and empower senders to identify and correct mistakes early in the process.