From this Thursday, January 9, 2025, immediate bank transfers throughout the European Union will be free for clients. That is to say, banks will no longer be able to charge a commission for instant money transfer.
The measure, which was approved by the European Parliament a little less than a year ago with 599 votes in favor, 7 against and 35 abstentions, ensures that transfers reach the recipient’s account in a maximum of 10 seconds, regardless of the day or the hour and without applying additional charges.
The regulations seek modernize the European payment system and benefit both individuals and small and medium-sized businesses. “Customers can say goodbye to waiting two or three business days to access their money”, celebrated the Dutch MEP and rapporteur of the regulation, after its approval.
The measure will work for both individual and business accounts. In fact, one of the objectives of the Regulation is to avoid waiting for retail customers and companies, especially SMEs.
More security
The Regulation also aims increase the security of transfers. Specifically, it establishes that banks and other payment service providers will have to apply robust and up-to-date fraud detection and prevention measures, in order to prevent transferred money from ending up in the wrong account by error or fraud. To do this, the rule indicates, payment service providers operating in the EU must offer, at no additional cost, a recipient identity verification service.
Furthermore, as an additional safeguard against fraud, entities must also allow their clients set a maximum amount for instant transfers in euroswhich could easily be modified before running a new transfer.
Fines and exceptions
Under the new rules, if an entity fails to meet its fraud prevention obligations and this causes financial harm, the client may request compensation. In addition, payment service providers offering instant transfers will have to verify whether any of their customers are subject to sanctions or other restrictive measures related to money laundering and terrorist financing.
Finally, there will be a special exception to the obligation to make the payment within ten seconds for such accounts outside of business hours, due to the risk of lack of liquidity in the European currency.