Another month, another mountain of invoices. The cycle of issuing, chasing, and reconciling payments. The endless uncertainty: "When will this invoice actually be paid?" If this scenario feels similar, you're not alone. For businesses, especially in the B2B space, this is an administrative burden, a drag on cash flow and a bottleneck to growth.
That's why the European Payments Council (EPC) introduced SEPA Request to Pay, often abbreviated as SRTP.
At its core, SEPA Request-to-Pay is a messaging framework allowing a beneficiary, such as a merchant or business, to send a payment request directly to a payer. The payer can then approve and execute this payment through SEPA channels, simplifying the entire process by, for example, reducing the need to exchange bank details. While this sounds straightforward, its true impact lies in its attempt to create a standardised model for request-to-pay across the EU, encouraging widespread business adoption within the SEPA region.
Looking beyond the mechanics, SRTP is designed to decouple the payer-payee interaction from the actual payment execution. This technical detail is where the revolution truly begins. It opens the door for a greater variety of service providers, including agile fintechs, to own the customer interface, potentially sidelining banks to mere back-end processors if they fail to adapt.
The genius and the threat of SRTP for incumbent banks lies in its decoupling of the user experience from the underlying transaction. Suddenly, the customer interaction layer is up for grabs. While banks have traditionally been the natural payment partners for merchants, SRTP allows for a high degree of flexibility in what can be built, with aspects like how the request is sent or how the user authenticates is left to the service provider. This is a direct challenge to banks that have been slow to match the neo-banks and payment specialists who offer better onboarding, rich merchant portals, and seamless integration.
The question banks must urgently ask themselves is: are we content to become commoditised utilities, or will we seize this opportunity to design and deliver the modern, omnichannel, and seamless payment services our customers now demand? The SRTP framework can be the foundation for "one-click payment approval," where customers no longer need to manually enter IBANs, keeping their financial data protected while enjoying a frictionless experience.
For Ximedes, which focuses on helping banks evolve into competitive fintech entities by building services deeply integrated with core platforms yet offering modern agility. Imagine SRTP powering instant payment requests for public transport top-ups or settling catering bills at large enterprises—areas where Ximedes already has a strong footprint with its Faretech solutions and Pecunda payment platform.
SRTP messages are designed to be processed in near-real time, 24 hours a day, 7 days a week. This operation is native to fintechs but often challenging to the legacy infrastructure underpinning many traditional banks.
The "24/7 payment request initiation" capability for merchants is a significant benefit of SRTP, but it places pressure on banks' underlying systems. It’s not just about handling an incoming SRTP message; it's about ensuring that the entire payment lifecycle, from initiation through to reconciliation and fraud monitoring, can operate with similar accuracy.
Many core banking systems are still batch-oriented, unsuited for the always-on demands of an SRTP-enabled world. The transition requires more than just new APIs; it necessitates a fundamental re-architecture or, at the very least, highly sophisticated middleware that can bridge the old and the new.
Failure to address this core system problem means banks risk offering a frustratingly disjointed experience, where the SRTP promise of speed shatters against the reality of back-office delays. The investment required is substantial, but the cost of inaction ceding ground to more agile competitors is arguably far greater.
Beyond the immediate transactional benefits, SRTP is engineered to facilitate "data-rich payments". The scheme mandates the use of standardised, structured remittance information with every transaction. While the most obvious advantage is simplified payment reconciliation for businesses and public administrations, the true value lies deeper. For banks and their fintech partners, this structured data is a potential goldmine.
Imagine leveraging this enriched data stream to offer corporate clients unprecedented insights into their cash flow, automate invoice matching with pinpoint accuracy, or even provide predictive analytics for financial planning. For retail customers, it could mean more relevant offers, personalised financial management tools, or enhanced security through more precise anomaly detection.
Merchants stand to be major beneficiaries of widespread SRTP adoption. The promise of simplified payment initiation, real-time payment confirmation, and potentially lower costs compared to traditional card schemes is highly attractive.
Add to this the built-in two-factor authentication and the irrevocability of payments (SRTP leverages SEPA Instant Credit Transfer, meaning no chargebacks), and you have a proposition that directly addresses key merchant pain points like fraud and chargeback-related costs.
This presents both an opportunity and a threat to banks. The opportunity is to package SRTP-based services into offerings for their merchant clients, potentially winning back business lost to specialised PSPs. The threat is that if banks don't price their SRTP services competitively or fail to provide excellent supporting services (like MONEI's real-time transaction status tracking dashboard), merchants may gravitate towards non-bank providers who fully embrace SRTP's potential.
The "seamless checkout integration" that SRTP enables for e-commerce could indeed make it a strong contender against card payments, particularly for high-value transactions or scenarios like payment-after-delivery where traditional methods have limitations. SRTP could even complement or progressively replace SEPA Direct Debits (SDD) by offering payers more control and flexibility, and payees increased payment certainty, especially when combined with instant payments.
SRTP is a strategic inflexion point for the European payments industry. For financial institutions, it acts as a catalyst, pushing them towards the agility, customer-centricity, and innovation that define successful fintechs. The "flexible payment timing" for customers and improved cash flow management tools it can enable are just the tip of the iceberg.
The path forward involves more than just implementing SRTP messaging. It requires a comprehensive approach: modernising core systems, rethinking customer journeys, leveraging data as a strategic asset, and fostering a culture of continuous innovation. This is where strategic partnerships become critical.
The question for financial institutions is no longer if they will engage with SRTP, but how deeply they will commit to leveraging it for transformation. Those who view it merely as a checkbox will miss the revolution. Those who see it as an invitation to redefine value, embrace agility, and forge strategic partnerships to build the next generation of payment experiences will not only survive but thrive.