One-off payment vs. recurring payment: is the SEPA credit transfer a good solution?

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There are two payment methods in the ever-changing world of payments: one-off payments, which occur only once, and recurring payments at a defined frequency and amount. 

It can be difficult to decide which payment method is best for you and your customers, so it is reasonable to ask about the differences between the two. 

Depending on the nature of your business, your services or products and your customers, one payment method may be more suitable than another.

We are going to compare these two payment methods and illustrate them with examples to help you, as a merchant, in your search for payment services.

Finally, among the host of available payment methods, we will focus on comparing the SEPA credit transfer with other types of payment to explore what it has to offer compared with the others. 

Focus on one-off payments: definition and key features  

Regardless of the payment method used (bank card, credit transfer, direct debit, cheque), making a one-off payment means issuing a payment that only occurs once.

As it does not recur, this payment method can be carried out instantly (e.g. in the case of an instant transfer, a one-off direct debit or a card payment) or with a delay, depending on the payment method used.

→ In the case of a SEPA Credit Transfer (SCT), the associated delay – usually between 1 and 3 working days – for the funds to be received by the beneficiary bank must be taken into account.

This payment method will be appreciated by your customers when the payment is for a single service, e.g. the consumer paying for your service or the online purchase of your products.

Focus on recurring payments: definition and key features  

A recurring payment has a set frequency, defined when it is created, for a fixed amount that is validated in advance.

This payment method is often preferred for an ongoing product or service, e.g. a subscription or a recurring bill.

Once the recurring payment has been set up, subsequent payments will be made without the need to validate them in advance.

To give some examples, depending on your company’s positioning and sector, you could set up this type of payment for the following use cases: 

  • subscription of your customers to your services (energy, streaming, gym, monthly rental, etc.)
  • payment of your monthly contracts (insurance premium, loan, lease, etc).

Recurring payments: what are the benefits for merchants and consumers? 

Recurring payments offer a range of significant advantages if you offer subscription-type services requiring regular payment:

  • Fast, one-time initialisation: even if the payment will be made several times, recurring payments only require the main details (IBAN, mandate or bank card details) to be entered once.

→ The first transaction acts as an initialisation procedure and subsequent transactions will be carried out on the basis of the details already gathered.

  • Cash flow planning: regular payments of a defined amount mean that you can forecast your incoming payments. 

→ You can forecast your cash flow, as payments (provided they don’t fail) will arrive on the set date.

  • Saves time: no need to worry about it every month – with the payment method you have chosen, payment will be made on a regular basis without the need for human intervention, and the same goes for your customers.

Depending on your business, recurring payments may be more favourable in the long term, provided you automate some of your payment processes to make life easier.

Why automate your payment processes for one-off or recurring payments?

Automating your payment processes offers a host of advantages, particularly for merchants.

By using modern technologies and dedicated tools available on the payments market, you can: 

  • Improve operational efficiency: today, there are many available solutions – including SlimPay – that enable you to reduce the manual processing of tasks linked to managing your company’s payment transactions (collection, refunds, etc.).

    Automated processing reduces human error and lets you focus on added-value tasks, while helping you to make significant savings in resources.
  • Manage your cash flow more effectively: having the ability to schedule your incoming payments (particularly recurring payments) makes it easier to manage your future cash accounts by having a clear view of future payments.
  • Improve the customer experience: modern technologies and the tools available on the market enable you to offer payment methods that are frictionless, flexible and adapted to your needs.

    → These solutions also offer a very high level of security, since transactions may be carried out using strong authentication depending on the payment method selected.

In addition, the world of payments is seeing a diversification of payment methods: in the past, the SEPA credit transfer was one of the most popular payment methods, but now it is in competition with many others.

Of all the payment methods available, what are the differences between the SEPA credit transfer and its competitors (cheque/cash, direct debit and bank card)? Why is it in decline and what is the best solution?

What features does the SEPA credit transfer offer for your one-off and recurring payments?

Now let’s focus on the SEPA credit transfer, one of the methods frequently used to pay for services.

This payment method lets you transfer funds in euros from an issuing bank to a receiving bank in the SEPA area.

It is characterised by: 

  • the beneficiary’s bank account number (IBAN);
  • the beneficiary’s bank identifier (BIC). 

First of all, note that there are three types of SEPA credit transfer: 

  • SEPA Credit Transfer (SCT): this was the first type of credit transfer to be launched on the market after the creation of the SEPA area.

    It allows funds to be transferred from one account to another, in other words from one bank to another, in one to two working days.

In general, consumers receive the bank details of the service provider who has raised an invoice.

Its main feature is that it can be immediate (if the requested execution date is the same as the day’s date) or deferred (if the requested execution date is after the day’s date).

  • SEPA standing order: this is an extension of the classic SEPA credit transfer.

By using it, consumers can automatically send a credit transfer on a fixed date, for an amount agreed with their bank.

If you choose this type of payment for your customers, you should be aware that the lifetime of the standing order can be configured through your bank’s app or website, and that it is possible to suspend a standing order at any time.

  • SEPA Instant Payment (IP): while it is called “instant”, it is actually carried out within 10 seconds.

This means that funds are quickly transferred from the debtor’s bank to the creditor’s bank, enabling your customers to pay their bills and services in a short space of time.

Another feature of instant payments is that they can be accessed 24 hours a day, 7 days a week, so long as both banks offer this facility. 

However, it should be noted that traditional banks often charge for this type of transfer, while new players and PSPs offer this service at a low cost.

For transactions between companies, for example, you can expect to pay around €1 for an instant transfer, with a maximum transaction amount of around €100,000, depending on the bank (on average, traditional banks set this authorisation at around €15,000).

Regulations are currently being introduced to require traditional banks to offer the same rates for IPs as for SCTs, for individual, professional and business customers alike.

In summary, here are the different types of SEPA credit transfer and their frequency:

Type of SEPA credit transferFrequency
Classic SCT credit transferOne-off payment
Standing orderRecurring payment
Instant Payment One-off payment

A number of changes are currently being considered, including the possibility of offering instant standing orders to specific customers (individuals, professionals or businesses), thus combining the advantages of these two types of transfer.

Is the SEPA credit transfer useful for one-off payments?

In practical terms, if you want to receive a one-off payment, you can use either SEPA credit transfer, if you want to defer the payment date for example, or an Instant Payment if you prefer an instant option.

As a merchant, you thus have several options for managing one-off payments for your services, in addition to the various payment methods that we will discuss at greater length later in this article.

As explained above, if you want to use the SEPA credit transfer to pay regular bills, for example, you should use the standing order if you don’t want your customer to have to repeat the transaction each time.

You can also opt to have your consumers make a standard SEPA credit transfer, but this has no advantage for regular transactions.

By making the classic SEPA credit transfer available for your subscriptions, your customers will have to re-enter the transfers each time they make a transaction, which is not necessarily advantageous either for them or for you.

Having said all that, let’s look at the basic differences between the SEPA credit transfer and the other payment methods available today, to see which might be the best alternative for you.

SEPA credit transfers vs. cash or cheque

Cheques and cash are two of the oldest means of payment.
However, in this article we will deliberately focus on the cheque, which unlike cash is a traceable method of payment, and where there are corporate rules, there is traceability!

So, SEPA credit transfer or cheque for a B2B payment?

In terms of costs for your customers, the cheque is the winner, because it is the only means of payment that will always be free, regardless of the financial institution. 

Even though the rules are changing for charging for Instant Payments, most traditional banks still charge around €0.80 for this transaction.

Your customers will thus be more reluctant to use this payment method on a regular basis.

For you, it is the same either way, as all the transactions remain under the control of your consumers, and all you can do is wait. 

Now let’s talk about time frames.

Using a cheque is a long and laborious process, for both you and your customers.

For the customer, they have to write a cheque in a world where most actions are now digital, send it by post, and wait for it to be cashed which, depending on the date and forward planning, may result in rejected payments if not well managed.

For you, it is much the same story, you need to cash the funds by sending the cheque to your bank and then wait 24 to 48 hours for it to clear.

Just imagine having to do the same thing every month to manage your subscriptions! 

Do we agree that there are better ways? 🙂

One-off paymentRecurring payment
SEPA credit transferPossible if an Instant Payment or classic credit transfer but in the customer’s handsPossible if a standing order but in the customer’s hands
ChequePossiblePossible, but payments must be sent on a regular basis. This is clearly not the preferred solution, especially for business-to-business payments.

SEPA credit transfers vs. bank card

There is one major difference between these two methods of payment: when talking about bank cards, this usually means using the existing networks, largely dominated by the US giants Visa, MasterCard and American Express.

These networks charge various fees at a significant percentage (interchange fee, scheme fee and bank fee), some of which depend on the amount sent.

In contrast, for SEPA payments, the amount to be paid for an SCT or IP credit transfer is fixed in advance and does not depend on the amount your customer sends you.

In terms of cost, the SEPA credit transfer is the best option, and you can find out how much you will have to pay by consulting your bank’s fees guide.

As far as security is concerned, traditional credit transfers are said to be safer, as IBAN fraud is much less common than credit card fraud, at least for now.

Lastly, if we look at the amounts paid, bank cards are generally used to pay small bills, whereas SEPA credit transfers are preferred for payments of larger amounts.

The final criterion to take into account is the failure rate versus the acceptance rate, and here again the SEPA credit transfer is the winner. Out of all payments made by card or credit transfer, there is a higher failure rate for the former than for the latter.

Table summarising the differences between SEPA credit transfers and bank cards for one-off and recurring payments:

One-off paymentRecurring payment
SEPA credit transferPossible if an Instant Payment or classic credit transfer but in the customer’s handsPossible if a standing order but in the customer’s hands
Bank cardPossiblePossible if the bank card details are entered in advance

SEPA Direct Debit vs. SEPA credit transfer?

These two terms are often mistakenly confused, because they involve the same players, but not at all the same payment processes, particularly where the payment initiator is concerned.

In the case of a SEPA credit transfer, you should be aware that payment is entirely in the hands of your end consumers.

Your consumers choose the credit transfer date and amount, even if you can tell them the amount beforehand, so they are free to send the funds whenever they like 🙂

And as you know, consumers are prone to the risk of manual error when entering the amount, which can damage your finances and cause you to go back and forth with your customers, something you can do without.

Worse still, if the customer “forgets” to make the transfer on the right date. Your cash flow will suffer, even though you could have avoided it.


By keeping the payment process under your control (or under the control of the payment service provider you choose to meet your needs and challenges).

In practical terms, by using direct debit rather than credit transfer, it is you who initiates the payment request, whether for a one-off or recurring payment.

What are the benefits for you? 

First and foremost, you can forecast your cash flow by managing collection dates and ensuring that the funds are actually debited on that date.

Secondly, as a merchant, you can be sure that you will receive the correct amount without any errors.

One-off paymentRecurring payment
SEPA credit transferPossible if an Instant Payment or classic credit transferbut in the customer’s handsPossible if a standing order but in the customer’s hands
SEPA Direct DebitPossible if a one-off direct debit and under your controlWhen creating the direct debit, you need to specify that it is a one-offPossible if a recurring direct debit and under your controlWhen creating the direct debit, you need to specify that it is recurring, at a frequency to be defined 

To conclude this article, in a world dominated by digital payments, there are a number of interesting possibilities for your business, whether for one-off or regular payments.

For the customer, the classic SEPA credit transfer has the advantage of being largely free of charge with a low rejection rate, unlike the Instant Payment, for which there is generally a fee (for B2B payments) but has offers the advantage of funds transfer in 10 seconds.

For you, this means choosing between charging your customers to obtain your funds quickly or waiting several days to receive the funds without your customer having to pay more.

This type of payment is thus an option for you, but certainly not the best one, the major disadvantage being that you are not in control of the collection process.

Alongside credit transfers, direct debits give you, as a merchant who collects funds, the opportunity to control the payment process: you are in charge of initiating the payment (date, amount and frequency).

By making direct debit available for your payments, you can forecast your financial flows while improving customer satisfaction, which should help to build customer loyalty over the long term, since no manual action is required on their part.