Ukraine approaches SEPA: what this means for Ukrainian Fintech and Business

The new initiative by the Ministry of Finance regarding the creation of a bank account registry and approaching SEPA is undoubtedly a positive step for the Ukrainian financial sector. But let's understand what this actually means and what challenges await us.

The initiative represents more than technical compliance — it's a comprehensive transformation that will reduce payment costs by 85-90% for euro operations, eliminate cross-border fees in the SEPA zone, and provide Ukrainian businesses with seamless access to over 520 million European consumers. The timeline aligns with Ukraine's EU candidate status, creating momentum for accelerated financial integration that could increase bilateral trade by 2-3 billion euros annually.

What Changes in Brief:

Technical advantages:

• Euro transfers in seconds instead of days

• Zero fees instead of 1.5%

• Direct integration with European payment system

For business, this means:

• Simplified trade with the EU

• Reduced currency risks

• Faster cash flow

Fintech Opportunities Through European Access

Ukraine's integration into SEPA creates transformational opportunities for fintech companies. Access to unified European payment infrastructure allows Ukrainian fintech to scale across 41 countries without traditional technical barriers, similar to how Revolut and Wise used SEPA for rapid expansion. Combining SEPA compliance with Ukraine's competitive cost structure can position Ukrainian fintech companies as serious competitors in European markets.

Regulatory advantages are equally significant. SEPA integration provides access to European fintech regulatory frameworks, including sandbox programs and open banking requirements, which will operate in Ukraine from August 2025. Ukrainian fintech companies can differentiate through cost advantages while maintaining European compliance standards, especially in cross-border transfers serving the Ukrainian European diaspora.

However, opportunities come with increased competition. European banks and fintech companies gain easier access to Ukrainian markets, creating pressure on domestic providers. Success requires early investments in European regulatory standards and strategic positioning around Ukraine-EU payment corridors before larger competitors establish market presence.

Market Transformation Through Cost Elimination

Economic impact extends far beyond payment processing efficiency. Cross-border payment costs within SEPA can decrease by 85-90% for Ukrainian businesses, with processing time improvements from 3-5 days to same-day or instant settlements. This transformation historically contributes to additional GDP growth of 0.1-0.3% through improved capital flow efficiency.

Small and medium enterprises receive the greatest benefits. Currently, 90% of Ukrainian SMEs expect positive impact from instant cross-border payments, with same-day settlements reducing working capital requirements by 20-30%. Access to standardized European payment infrastructure eliminates competitive disadvantages faced by Ukrainian businesses when serving European clients.

Consumer benefits are equally compelling. Average consumers save 50-100 euros annually on European transactions through eliminated cross-border fees, gaining payment mobility throughout the SEPA zone with unified bank accounts. However, this creates currency risk for Ukrainian businesses outside the eurozone and potential dependence on European payment infrastructure during geopolitical tensions.

Key Challenge: Currency Control vs Instant Payments

However, the biggest obstacle to truly instant SEPA payments remains Ukraine's currency control. In the European Union, in the SEPA zone, currency control is absent - payments flow freely without additional checks. In contrast, in Ukraine, every currency payment requires justification, documentation, and compliance verification by the bank.

This creates a fundamental contradiction: technical infrastructure can provide instant transfers, but currency legislation requires verification of each operation. An "instant" payment can hang for hours or days in currency control.

The National Bank will have to resolve this dilemma - either significantly simplify currency control for SEPA operations or develop automated verification mechanisms. Possible solutions include creating "white lists" for certain types of operations, raising limits without checks, or implementing real-time risk management systems.

What Ukrainian Banks Should Do Now

• Don't wait - start adapting processes to European standards now

• Invest in compliance - AML/KYC procedures will become critically important

• Prepare teams - specialists in European regulation will be needed

• Develop automated currency control systems for SEPA operations

This is an important step, but not a revolution. Full SEPA integration takes 2-3 years even for prepared countries. Ukraine will need at least 3-5 years when:

• European legislation is fully implemented

• Banks rebuild their infrastructure

• True digital banks of European level appear

However, Ukraine is finally moving in the right direction. For Ukrainian fintech, this is a chance to become part of the European ecosystem, not just its periphery.