SEPA Transfers in the API Era: What Fintech Companies Need to Know in 2025

If you are running a fintech in today’s modern world, you’re already living in the API age. Everything from banking, compliance, risk analysis, and even KYC is being reimagined through clean endpoints and real-time data syncs.

But not every fintech platform applies the same rules or uses the same technologies. There is one area that continues to be both a lifeline and a landmine for European-facing businesses. There is something called SEPA transfer.

Whether you are building a neobank, creating a digital-wallet platform, or the next innovation in cross-border payments, understanding how SEPA works, especially in this high-tech, API powered ecosystem, is no longer optional.

After all, we are talking about the infrastructure underneath everything from payroll apps to embedded finance platforms.

This led us down a rabbit hole, analyzing SEPA transfers in 2025, seeing what’s changed, what hasn’t, and what you absolutely need to know to avoid delays, regulatory headaches, and bad UX.

First, a Quick Refresher: What Is SEPA?

SEPA stands for Single Euro Payments Area, but if you are running a fintech business in Europe, you already know that. It is a system that allows a smooth, standardized, and euro-dominated bank transfer across many European countries. This is like Europe’s Autobahn, with one set of rules, not tolls, and most importantly, no speed limits.

But it is important to know that there are two main types of SEPA transfers.

SEPA Credit Transfer (SCT), which is a standard one-off euro payment, typically settled within one business day, and SEPA Instant Credit Transfers (SCT Inst), which is a real-time euro payment that is complete within seconds.

If you have a fintech business in Europe and are still not offering SEPA Instant, then you are a few laps behind.

SEPA + APIs: Why It Matters More Than Ever

Nowadays, fintech isn’t about building payment flows and how fast money travels, since most of the companies already offer instant transfers using the SEPA ecosystem. Nowadays, it is more about versatility and usefulness through API infrastructure.

This means that it is more about embedding finance into every app, platform, and transaction. Which means that you need a back-end money movement system that’s programmable, reliable, and compliant.

The good news is that SEPA transfers, especially when powered by modern APIs, can be the engine operating in the background.

They can help you embed B2B payments in invoicing tools, instant salary payouts in neobank apps, cross-border merchant settlements in marketplaces, consumer bill pay, and peer-to-peer payments, and many other things.

But legacy SEPA integrations are often slow, batch-based, and often wrapped with XML nightmares. That’s why we see the rise of Banking-as-a-service (BaaS) platforms. These are open banking APIs and SEPA-as-a-service providers that are built in a way to avoid infrastructure headaches.

What’s New in 2025?

Several big shifts have shaped SEPA in the past year, and fintechs should take note:

1. SEPA Instant Is Becoming Mandatory

The European Commission has pushed harder than ever to make SEPA Instant the default, not the luxury. Many major banks are now required to offer SCT Inst for inbound and outbound payments, at no extra cost. This is a game-changer for fintechs building consumer apps—because now your users expect instant euro transfers, and anything slower feels broken.

2. Improved API Access via PSD3/Open Finance

With PSD3 and the European Open Finance Framework in full swing, banks are obligated to open up more than just account data—they must now support payment initiation and fund confirmation via secure APIs. That means fintechs can integrate more deeply, reduce fraud, and verify balances before initiating SEPA payouts.

3. Greater Emphasis on AML and Name Matching (a.k.a. IBAN + Name Verification)

SEPA transfers now increasingly require IBAN + Name matching, especially for instant payments. Many banks reject transfers if the name on file doesn’t match what’s sent. Fintechs must now build in name-checking flows (or use third-party services) to prevent failed payments and customer complaints.

SEPA vs SWIFT in 2025: What You Should Use and When

Let’s settle this: if your users are sending money in euros, within Europe, you should be using SEPA. Period.

Still using SWIFT for intra-EU transfers? You’re burning money and time. SEPA transfers are:

• Cheaper (often free for the sender)
   
• Faster (seconds vs. 1–5 business days)
   
• Simpler (no BIC codes or currency conversions)
   

SWIFT only makes sense when you’re moving non-Euro currencies, sending outside SEPA-participating countries, or dealing with exotic banking jurisdictions.

Final Words

Today, SEPA isn’t just a bank-to-bank connection. It is a digital product, and the lifeline of European fintech companies. The good thing is that the system is open and allows many API integrations.

Fintech companies can use the power of the SEPA network and combine it with other creative tools like budgeting apps, invoicing solutions, or even AI, just to offer more versatility and a better end product to consumers.