EU Adopts Hungarian-Inspired Payment Regulation
The Regulation on immediate transfers in Euros, which came into force on April 8, 2024, aims to facilitate instant transfers in Euros across the European Union. This regulation ensures that customers can make quick transfers through any banking channel, with the money reaching the beneficiary within seconds.
This development aligns with Hungary’s trajectory since 2020, where instant transfers have been established as a fundamental service. The Hungarian National Bank (MNB) is preparing for the next stage of domestic Instant Payments by introducing QR codes, NFC, and payment request solutions, offering consumers a convenient and free alternative in all payment situations.
The slow adoption of instant credit transfers in Euros within the euro-zone member states has been due to the lack of participation from all European banks. To address this issue, MNB introduced Instant Payments in 2020, mandating all payment service providers to offer instant transfer services.
Building upon Hungary’s successful model, the European Commission has introduced regulations for euro-based instant transfers. These rules mandate that immediate Euro credit transfers should be credited to the payee’s account within 10 seconds, 24/7, ensuring prompt receipt of funds for consumers and businesses.
The regulation also focuses on equal charges, enhancing security, and setting an envisaged timetable for implementation. Payment service providers must not charge higher fees for immediate credit transfers compared to regular transfers, must enhance security measures to prevent fraud, and must adhere to specific timelines for implementation.
Furthermore, starting April 1, 2024, payment service providers must offer customers the option to accept payment requests. Instant Payments initiated in response to payment requests and Instant Payments with QR codes are free of charge for consumers, providing a seamless and cost-effective payment solution.
QR code payments will be widely applicable for in-store, online purchases, and bill payments, offering benefits such as lower costs, immediate crediting, and integration possibilities with loyalty programs and e-commerce initiatives.
Overall, these new regulations aim to streamline payment processes, enhance security, and improve accessibility to instant transfers in Euros, benefitting both consumers and businesses across the European Union.
