Credit transfer

Whether you need to pay for a purchase, receive your salary, or split the cost of a holiday with friends, a credit transfer is a safe and reliable way to move money without having to handle cash.

What is a credit transfer?

A credit transfer is the movement of money between two payment accounts. If the accounts are both within the Euro Payment Area, it is known as a SEPA credit transfer - SEPA stands for Single Euro Payments Area.

If you are the person sending the money, you are known as the payer. If you are receiving it, you are the payee.

You can also make a transfer between two of your own accounts - in that case, you are both payer and payee. This is referred to as an internal funds transfer.

Making a credit transfer

To make a credit transfer, you need a payment account or an account card - that is, a prepaid card with an IBAN. Your account could be held with a bank, a post office, a payment institution, or an electronic money institution.

You can make a credit transfer using your bank's online services (home banking), at any time and from anywhere. Alternatively, you can go to a branch or post office counter, depending on the type of account you hold.

Whether online or in person, you will need to provide:

• the name of the person or organisation receiving the money (the payee);
• the IBAN of their account;
• the payment reason (known as the 'payment reference' or 'narrative');
• the amount you wish to send.

Shopping online with a credit transfer

When buying goods or services online, you might come across different situations:

• Some e-commerce platforms do not support credit transfers directly. In this case, if you wish to pay by credit transfer, you'll need to log in to your home banking and enter the seller's IBAN manually. The goods are usually dispatched only once the payment has been received. Be careful when making transfers outside of secure e-commerce platforms - only use this method if you fully trust the seller!
• Some platforms do support credit transfers as a payment method. For instance, the MyBank logo indicates that the website participates in a system which allows the seller to receive instant confirmation that your payment has been authorised by your bank.
• Another option is to use a Payment Initiation Service (PIS). Some websites offer this service directly. You enter your online banking credentials on the site, and a regulated Payment Initiation Service Provider (PISP) arranges the transfer on your behalf. The payment is still a credit transfer, but instead of logging in separately to your banking app or website, it's all integrated into the checkout process. This makes it simpler and faster.
• A particular type of credit transfer takes place within 'closed-circuit' systems. These involve both the customer and merchant having accounts with the same provider. The money is transferred within that provider's own system and doesn't go through the wider banking network. It's similar to transferring funds between two accounts at the same bank. The larger the circuit, the more useful it is for both customers and retailers. These services are often available through dedicated apps on your smartphone or computer. Examples include PayPal and Satispay, which operate using electronic money accounts.

Costs and processing times

There is usually a fee for making a credit transfer, which can vary depending on several factors: the type of transfer, the amount, the currency (e.g. pounds sterling), the recipient's country, and whether you use online banking or go to a branch.

Fees are set by each provider, but European legislation places certain limits. For example, you cannot be charged more for a transfer to another SEPA country than you would be for one within Italy.

How long does it take for the money to arrive? By law, the execution time (or settlement time) is: one working day for standard online credit transfers; two working days if the transfer is made in person at a bank counter; less than ten seconds for instant credit transfers.

Risks

Before confirming a credit transfer, always double-check the recipient's details, especially the IBAN. Think of it as the account's 'address' - if it's entered incorrectly, the money could end up in the wrong account.

Online purchases carry additional risks. As mentioned, many websites don't accept credit transfers directly, so the transaction has to be completed outside the platform. This is riskier, and it's safer to use this method only with sellers you know and trust.

If you're receiving a credit transfer, bear in mind that a confirmation receipt or a reference number (such as the Italian CRO - Operation Reference Code) does not guarantee that the money has actually been transferred. A transfer can still be cancelled or reversed after it's been initiated. Always check your account to make sure the funds have been received, and never rely solely on screenshots or images sent by others.