SEPA & BIC: Everything you need to know!

The most important things at a glance:

Here you will find answers to the following questions:

In addition to being able to transfer amounts in euros, bank customers have a simpler and safer payment instrument at their disposal - the SEPA. In our article you will find interesting background information about SEPA and why you can now do without the BIC.

What does SEPA mean?

SEPA is the abbreviation for " Single Euro Payments Area " and describes the uniform Europe-wide payment area for transactions in euros. Since February 1st, 2014, in accordance with the SEPA regulation, the national payment procedure has been replaced by the new SEPA payment system in many countries. The aim of this alliance was to "harmonize" payment transactions across Europe and thus further promote European integration. With these new regulations, international payments were carried out according to the same principle as domestic German transactions.

Where does SEPA apply?

In addition to Germany, the uniform euro payments area includes 27 other EU countries :

Belgium, Bulgaria, Denmark, Germany, Estonia, Finland, France, Greece, Great Britain, Ireland, Italy, Croatia, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Austria, Poland, Portugal, Romania, Sweden, Slovakia, Slovenia, Spain, Czech Republic, Hungary, Cyprus), the three EEA countries Iceland, Norway and Liechtenstein as well as Switzerland and Monaco.

The following other states are also involved:

  • EEA countries (European Economic Area): Iceland, Liechtenstein, Norway
  • Other countries: Switzerland, Monaco and San Marino

What is SEPA used for?

This payment method is used within the uniform European payment area for cashless transfers. This means that both international transfers and domestic transfers can be processed in euros. The data required for such a transfer always depends on the country to which the money is being transferred.

In any case, the IBAN of the payee is required. The BIC was also used for international money transfers until February 2016. However, since 01/02/2016 specifying an account number and corresponding bank code are no longer necessary.

Why is the BIC no longer required?

Not only the old account number and the national bank code have taken care of. The international bank identifier BIC (Bank Identifier Code) is also no longer required since February 2014. The BIC was still queried by the payees, but from this point on it was already superfluous for money transfers within Germany. Today only the IBAN is required for transfers within the SEPA area. Since February 1, 2016, banks are officially only allowed to carry out transfers with this number.

Important : Since February 2016, the bank code is no longer required for transfers abroad. It could also be argued that it was "secretly" removed from the national banking sector.

What are the advantages of SEPA for Europe?

You could call SEPA “one account for all of Europe”. This payment system guarantees that transferred amounts reach the recipient within one bank business day - regardless of whether the transfer was made in another European country or within Germany.

It should be emphasized that this creates advantages, particularly for companies operating across Europe. Accounts in other countries become superfluous for these companies, as they only need one account for the payment system, which means that there is no need to open an account abroad. This not only reduces the administrative effort, but also saves money.

Further advantages of SEPA are:

  • Payment transactions between the participating countries have become easier
  • There are no longer any delays with direct debits
  • By specifying one file format, data loss has been reduced
  • Cross-border direct debits are being replaced by standards
  • There is a common legal framework that applies to all participating countries
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The German e-money institute Pay Here has specialized in payment services with Debit Mastercards and accounts without Schufa. Individual solutions are offered for both private and corporate customers.

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