2024-02-29 06:27:39
Some transfers take up to three days. However, an additional fee is charged for an express transfer. The EU now wants to change that.
Good news for all bank customers: Additional fees for real-time transfers will soon come to an end. On Monday in Brussels, the EU countries finally approved a regulation that enables such immediate payments in euros.
More specifically, it states that banks will no longer be allowed to charge additional fees for instant transfers, so-called instant payments or real-time transfers. Instant transfers may not cost more than standard transfers, which are usually free. The new rules should apply from autumn 2025.
More consumer protection for standard transfers too
The Instant Transfer Regulation aims to enable people living in the EU to transfer money within ten seconds at any time of the day, including outside business hours, not only within the same country but also to another EU Member State. The applicable fees may not be higher than the fees for standard transfers.
To ensure that an instant transfer does not end up with the wrong recipient, the new regulations require providers to check in the future whether the IBAN and the recipient’s name match. This is intended to alert consumers to possible errors or fraud before making a transfer. The same should apply to standard transfers. The regulation takes into account the specific characteristics of companies outside the euro area.
Paypal would also be affected
According to information from “Focus”, digital payment providers would also be affected under the new regulations. For example, PayPal users pay a fee of one percent of the transfer amount for instant transfers, but at least 0.25 euros and a maximum of ten euros.
A standard transfer is free with Paypal, but the processing time is between one and three working days. In response to a request from “Focus”, the press office of the Council of Europe announced that instant payments apply to payment providers in the euro area. Paypal is also affected, reports “Focus”.
Strengthening European competition in payment transactions
The new rules are seen as a further step by the international community to strengthen European payment providers in competition against the large US companies Visa and Mastercard. “The new rules will improve the strategic autonomy of the European economic and financial sector, as they will help reduce excessive dependencies on financial institutions and infrastructure in third countries,” said the Council in Brussels.
The new law is scheduled to come into force by April and will then take effect after a transition period of 18 months, i.e. probably in autumn 2025. In countries where the euro is not the legal tender, the innovation will apply from 2027 for transfers in euros and from 2028 apply to those in the respective national currencies.