The Single Euro Payments Area (SEPA) becomes a reality tomorrow: SEPA aims to make crossborder electronic payments in euro within the 27 EU countries, the European Economic Area (Norway, Liechtenstein and Iceland) and Switzerland - as quick, easy and efficient as domestic payments.
The implementation of SEPA will allow businesses and consumers to reap the benefits of a common currency and integrated payments system that have been established within the boundaries of the European Union.
For the past year, HSBC has been working to ensure its systems and tariffs are compliant with the requirements of the new payments area and which will result in cheaper and more efficient banking.
Besides cutting down on the sometimes lengthy transaction time of international payments, from the European norm of four days to next day value, SEPA also brings about dramatic reductions in costs on international incoming and outgoing payments.
A new transparent and competitive tariff of charges will be launched tomorrow: all euro inward payments to HSBC Malta with a value of €10,000 or under will be free of any charges from HSBC here. HSBC has also substantially reduced its Outward SEPA payment charges for those using electronic banking.
To make a SEPA payment, customers must provide the International Bank Account Number (IBAN) and the Bank Identifier Code (BIC) and within their payment instruction. This is important to ensure the efficiency of payments across SEPA. Customers can obtain these numbers from their bank.
A variety of reductions and incentives are also available for retailers and merchants using debit and credit cards on HSBC's electronic point of sale (EPOS) terminals. Cards issued by other banks within the SEPA zone which are used on an HSBC EPOS terminal will attract a charge based on HSBC's new standard, transparent tariff after taking into account any Interchange fees payable to that other bank. The tariff starts at a lower level than the previous standard rate quoted in the media.
HSBC's new tariff is based on volumes so there is a real opportunity for retailers and merchants to further reduce their costs by accepting more cards across HSBC's new POS machines rather than cheques or cash which have their own costs and considerations. All HSBC's EPOS machines have been recently certified by Visa and MasterCard to accept CHIP and PIN cards.
A major investment in CHIP and PIN technology will also enable HSBC to start making available the more secure CHIP and PIN cards to HSBC's local cardholders. HSBC will also shortly be issuing a brand new CHIP and PIN International Debit Card. For a modest charge, the cardholder will have the benefit of this international debit card with improved technology and security features that can be used on other banks' ATMs within the European Union. Notwithstanding the heavy investment in technology and resources HSBC has not increased the annual fee of Credit Cards for customers.
Retailers and merchants will soon be contacted individually to be advised of the new SEPA tariff of charges for merchant card services provided to them. Over 3,300 merchants will benefit from a reduction in charges arising from HSBC's new SEPA tariff which will see a reduction of over €550,000 in fees based on 2007's turnover.
Simultaneously, HSBC's new tariffs for SEPA payments charges on an electronic or manual basis will be advised to customers and will show substantial reductions for those migrating to electronic payments.