OVERVIEW
The Instant Payments Regulation (often referred to as the Instant Payments Directive/Regulation) is an EU legal framework designed to make instant euro bank transfers widely available, affordable, and secure across the European Union. It amends the Single Euro Payments Area Regulation and forms part of the EU’s broader payments modernisation strategy.
What is the Instant Payments Regulation
The Instant Payments Regulation (IPR) requires payment service providers in the EU to offer and receive instant credit transfers in euro.
An instant credit transfer is a payment that:
- Is executed within 10 seconds
- Is available 24/7 (including weekends and holidays)
- Allows the recipient to access the funds immediately
- Has a transfer limit (initially around €100,000, though this may evolve)
The regulation aims to:
- Ensure instant payments are available everywhere in the EU
- Reduce reliance on card schemes and non-EU payment providers
- Improve consumer convenience
- Enhance economic competitiveness and financial innovation
Key requirements under the regulation
The regulation imposes several core obligations on payment service providers. First, they must offer instant payments, meaning they are required to both send and receive instant euro transfers. This ensures full participation in the system rather than partial adoption.
Second, pricing must remain fair: the cost of an instant payment cannot exceed the fee charged for a standard SEPA credit transfer. This removes the premium pricing model that previously limited adoption.
Third, providers must implement a verification of payee system (IBAN-name check). This mechanism confirms whether the recipient’s IBAN matches the intended beneficiary’s name, helping to prevent fraud and reduce errors in payments.
Finally, payment service providers must comply with EU sanctions screening requirements without causing delays to transactions. This ensures regulatory compliance while preserving the speed of instant payments.
Who are the ‘subject persons’
The regulation primarily applies to payment service providers (PSPs) operating within the EU that offer euro credit transfers, as defined under the Payment Services Directive 2 (PSD2).
These include credit institutions, such as traditional banks, which are required to both send and receive instant payments. Payment institutions are also covered—these are companies licensed to provide services like money remittance or payment processing, often including fintech firms.
Electronic Money Institutions (EMIs), which issue electronic money and provide payment accounts, are also subject to the regulation. In addition, branches of third-country payment providers fall within scope if they operate in the EU and provide relevant payment services.
Geographic Scope
The regulation applies to payment service providers located in EU Member States that use the euro. It may also extend to some non-euro countries within the Single Euro Payments Area (SEPA), depending on implementation timelines and specific national arrangements.
Implementation Timelines
The implementation timeline varies depending on whether a country is part of the eurozone. For eurozone PSPs, the obligation to receive instant payments comes first, followed by the requirement to send them at a later stage.
Non-eurozone PSPs are granted longer transition periods to comply with the regulation. Overall, implementation deadlines are expected to fall between 2025 and 2027, depending on the specific obligation and jurisdiction.
Who is not directly regulated
The regulation does not directly impose obligations on consumers, ordinary businesses, or merchants. However, these groups benefit indirectly because their banks and payment providers are required to support instant transfers, improving the overall payment experience.
What the regulation aims to achieve in practice
In practical terms, the regulation will make sending money between EU bank accounts nearly instantaneous—comparable to sending a message. Instant payments are expected to become the standard rather than a premium service.
The introduction of IBAN verification will help reduce fraud and payment errors, while increased participation from fintech companies may enhance competition and innovation in the EU payments market.
In short, the Instant Payments Regulation requires EU payment service providers—including banks, payment institutions, and e-money institutions—to offer fast, 24/7 euro transfers that are completed within seconds, at a cost no higher than standard SEPA transfers.
How can Computime FinTech Help?
Our team supports financial institutions in meeting the reporting and monitoring requirements arising from the Instant Payments Regulation (IPR) by providing automated regulatory reporting, data aggregation, and real-time analytics across payment systems. The platform enables banks and payment service providers to consolidate transaction data related to instant credit transfers, monitor operational metrics such as processing times and transaction volumes, and generate structured reports aligned with regulatory expectations. By centralising payment data and applying validation and reconciliation controls, BRSANALYTICS helps institutions maintain data accuracy, streamline compliance workflows, and produce timely reports required for supervisory oversight under the IPR framework.