SEPA and SWIFT Transfers: Key Differences

    SEPA and SWIFT Transfers: Key Differences

Although international payments are widespread and popular, not everyone now knows about SEPA and SWIFT. So, we’re happy to cover the details of these systems in this article. Today, these are the two most common methods in the world. For sure, SEPA and SWIFT are very similar. Both systems are used to transfer funds internationally, from one bank account to another. The key differences show up when it comes to coverage and speed. For instance, SWIFT transfers take a long time and require a lot of detailed and accurate information about the beneficiary and the beneficiary bank. SEPA transfers require only the beneficiary’s bank account number (IBAN).

Advantages and disadvantages of SEPA transfers:

SEPA transfers are transactions exclusively within the eurozone. Parties are allowed to make payments in euros only. Advantages: — Typically, low or no fees. — Transfers take from one second to one day. — Convenient transfer process. — Minimum information required. — Secure transactions. — Regular transfers, payments for services and bills, and bank card payments are available. — Both EU residents and non-residents, who have an account in European banks, can use it. Disadvantages: — Available only in 36 countries. — It works with euros only. — The transfer limit is usually EUR 100,000.

Advantages and disadvantages of SWIFT transfers:

SWIFT transfers are transactions at the international level. It covers over two hundred countries. Parties are allowed to make payments in any currency. Advantages: — It’s available all over the world. — It works with any currency. — If offers many features. — No transfer limits for individuals and legal entities. — Regular transfers, payments for services and bills, and bank card payments are available. Disadvantages: — High fees and currency exchange costs. — Transfers take up to 5–7 business days. — It requires detailed information about the beneficiary and the bank.

How to make a SEPA transfer:

If you live in the SEPA zone, you’ll most likely be able to transfer funds from any of your bank accounts. If you’re not entirely sure about that, you can check this information with your bank or refer to the register of participants in SEPA payments. Making a transfer requires you to follow a few steps: 1. Log in to your bank account. 2. Specify the beneficiary’s details and the amount you want to transfer. 3. Add the beneficiary’s IBAN (bank account number). 4. Confirm the above information and send the transfer. 5. Funds must be credited within one day.

How to make a SWIFT transfer:

Depending on the situation, a SWIFT transfer may be available in your online banking service, mobile applications, or only at bank counters. Making a transfer requires you to follow a few steps: 1. Provide the beneficiary’s account details: a SWIFT code for the beneficiary bank, its full name in English, IBAN, the name of its branch that receives the funds, and details of intermediary banks, if any. 2. Fill out a transfer application online or at a bank. 3. Deposit funds to the debit account, check the data, pay fees, and confirm the transaction.

Summing it all up:

SEPA is a simpler, faster, and cheaper version of SWIFT to make international payments within the EU and beyond. It all depends on what you need. SharPay customers—both individuals and entrepreneurs—can make SEPA transfers, too. If you have many recipients and regular transfers, mass payouts let you send them in a single batch. The service processes all transfers several times a day according to the rules. However, it typically takes no more than one business day.  Sign up and become a part of SharPay today:  https://sharpay.net/

The difference matters most when the transfers are regular: suppliers, contractors, salaries. For that a company needs its own euro account inside SEPA — a business IBAN in the company name rather than a personal card. SharPay opens it remotely, with euro payments running through SEPA.

SEPA vs SWIFT: the differences that cost money

Both move money between accounts, but they are different things: SEPA is a payment scheme with fixed rules, SWIFT is a messaging network banks use to instruct each other. That distinction produces every practical difference below.

  • Currency. SEPA moves euro only. SWIFT handles any currency.
  • Geography. SEPA covers the euro area and a few neighbours. SWIFT reaches almost everywhere.
  • Speed. SEPA: same or next business day, seconds under instant schemes. SWIFT: one to five business days, depending on the chain of banks.
  • Fees. SEPA: each side pays its own bank, and the amount arrives whole. SWIFT: correspondent banks deduct along the way, so the recipient often gets less than was sent.
  • Predictability. With SEPA you know the cost in advance; with SWIFT the final total is known only after the payment lands.

When a non-SEPA transfer is unavoidable

If the payer or the payee sits outside the scheme, or the payment is in dollars or pounds, SWIFT is the only route. What you can control is which side pays the intermediary charges — the OUR, SHA and BEN options in the payment instruction — and agreeing that with the counterparty beforehand avoids the classic argument about a missing 30 EUR.

Published costs here: incoming SEPA 1 EUR + 0.35 % personal and 10 EUR + 0.30 % business; incoming SWIFT in euro 30 EUR + 0.30 % personal and 50 EUR + 0.35 % business; transfers between accounts inside the platform are free. Accounts: personal IBAN and business IBAN.