- On 6 March, the Republic of Moldova was officially admitted to SEPA
- The entry of the State into the strategy is another step on the way to the European Union
- Moldova in SEPA can translate into economical improvement in the future, as well as the standard of surviving of its citizens
On 6 March, the Republic of Moldova was officially adopted into the Single Euro Payments Area strategy (SEPA), by decision of the European Payments Council. This step opens the way for Moldova to accomplish easier and faster non-cash payments in euro and to reduce the costs of these transactions between its citizens, businesses and another SEPA members. This decision is besides a further step towards full integration of the country into the structures of the United Europe.
What is SEPA?
The Single Euro Payments Area is simply a European strategy whose main nonsubjective is to simplify, harmonise and reduce the cost of euro payments in all associate States. This strategy facilitates rapid, safe and efficient transfers between bank accounts in its own countries, eliminating differences between national and cross-border payments [1]. Moldova made an authoritative application to join SEPA on 30 January 2024. At the beginning of this year, the country adopted the euro as the mention currency on the basis of which the authoritative exchange rate of the Moldovan leu [2].
What does this mean for Moldova?
The accession of the Republic of Moldova to the Single Euro Payments Area represents another crucial step towards the accession of the State to the European Union and its integration into the European economical System. At the same time, the integration of the state into SEPA is expected to translate into an increase in Moldova's economical development, as well as into the economical situation of citizens, by influencing circumstantial sectors of the state economy. The National Bank of Moldova points out that SEPA membership will have a affirmative impact on, among another things, the amount of abroad investment in the country, making it easier for Moldovan entrepreneurs to access European markets and increase their competitiveness in the European Union [3].
Conclusion
The inclusion of Moldova in the Single Euro Payments Area is undoubtedly a manifestation of a dynamic process of integration of the state into the structures of the European Union. Since March 2022, i.e. since Chisinau's authoritative application for membership of the organisation, this country has taken crucial steps towards this accession.
Joining SEPA, in addition to being an effort by the Moldovan authorities to adapt to European financial standards, is besides a step that can importantly affect the economical situation of the country. 1 of the poorest European countries in Moldova has an crucial percent of its diaspora in the Eurozone countries, which frequently sends any of the money earned to its families in the country. Membership of SEPA will enable them to make payments in a European currency with lower fees for cross-border transactions, so that residents of the Republic of Moldova will be able to receive higher amounts at a lower cost. At the same time, the strategy besides assumes faster booking of non-cash payments in abroad accounts, making specified transfers more efficient.
In addition, joining the Single Euro Payment strategy can contribute to the growth expected by the National Bank of Moldova in its area of direct abroad investment by another European countries. Integration with SEPA means compliance with the European payment infrastructure, which affects abroad investors' assurance in the safety and attractiveness of capital in the country. Inflows of abroad investment can in turn let for the creation of fresh jobs and the overall economical improvement of Moldova.
