The EBA has released a series of recommendations to help PSPs address the requirements of the Instant Payments Regulation for Euro-denominated instant payments involving currency conversion. The recommendations, developed by 18 account-servicing payment service providers (AS-PSPs) from 11 European countries, focus on how foreign exchange specialists and payment practitioners interpret the regulatory obligations affecting real-time transactions that operate 24/7/365.

The document offers practical advice for managing these transactions under the new rules. Addressing the currency conversion challenge According to officials from the EBA Practitioners Group on Instant Payments, the regulation presents particular challenges for PSPs that handle accounts in currencies other than the euro. They noted that PSPs must now carry out currency conversions within seconds, even outside standard market hours.

This requires them to provide exchange rates at any time, including when the foreign exchange markets are closed. The EBA’s recommendations are designed to offer guidance on managing the operational implications of these new requirements, which will apply to Eurozone PSPs starting 9 January 2025. This note is the first output of the EBA’s Practitioners Group on Instant Payments, which was created following the enactment of the Instant Payments Regulation in the second quarter of 2024.

The group aims to assess the regulation's operational impact and develop recommendations based on a pan-European approach. The full report, titled 'FX Conversion for Instant Payments in Euro: Practitioners’ Understanding and Recommendations,' is available on the EBA’s official website. About the Euro Banking Association (EBA) The Euro Banking Association is an organization that facilitates dialogue and exchange among payments industry professionals with a focus on a pan-European approach to payments.

It works to help its members understand regulatory changes and supports the development of market practices. The EBA has more than 160 members from across the European Union and other regions. .