If your business offers customers European bank account details, IBAN discrimination impacts whether your customers can actually use them as expected.

The key principle of the Single Euro Payment Area (SEPA) is that all cross-border electronic payments in euros are as easy to make as domestic payments. Unfortunately, IBANs are sometimes (illegally) rejected because they’re issued in another SEPA country. 

When IBAN discrimination prevents customers from reliably using their IBANs, it can create:  

• Failed deposits, withdrawals, payouts, or Direct Debits that prevent money from moving  
• Excess support queries where customers might turn to you for help, even though a third party rejected the payment
• Lower account activation and retention when customers can’t fund accounts or use them across countries 
• Slower European expansion when account acceptance varies by country or use case 
• More operational complexity if your banking partner can’t support European payment flows without multiple workarounds  

Luckily, IBAN discrimination is being tackled in several different ways. In this article, we’ll cover: 

• What is IBAN discrimination? 
• The impact of IBAN discrimination on fintechs and payment businesses 
• Regulatory and fintech approaches to tackling IBAN discrimination 
• How the right European banking infrastructure can reduce account acceptance issues 
• Why choose ClearBank for European payments and account infrastructure? 

Note: ClearBank Europe helps fintechs, payment institutions, and businesses across Europe access SEPA Credit Transfer, SEPA Instant, and account infrastructure through our Netherlands-based European bank, using Dutch IBANs that are widely accepted across the EU. Get in touch to learn more.  

IBAN discrimination happens when a company, employer, public authority, or payment provider rejects a valid SEPA account because the IBAN is issued in another country. 

For example, a French customer living in Spain should be able to pay a Spanish mobile phone bill from their French bank account. If the provider refuses the payment simply because the IBAN starts with “FR” rather than “ES”, that’s IBAN discrimination. 

The same issue can affect businesses. If a fintech provides customers with European account details and those IBANs are rejected by employers, merchants, or platforms, customers may experience failed payments, even though the account itself is valid. 

IBAN discrimination is illegal under Article 9 of the SEPA Regulation ((EU) No. 260/2012), which forbids location requirements on SEPA payment transactions. Despite this, it continues to be a considerable problem, with banks declining cross-border SEPA payments at a far higher rate than domestic payments.

To understand why IBAN discrimination is such a problem, it helps to understand the role IBANs play in SEPA payments.  

SEPA was created to make it easy for customers and businesses to use a single euro payment account across all 36 SEPA countries.  

For example, if you’re from France but work in another European or SEPA country, such as Spain, your employer can pay your wages into your French bank account. You shouldn’t need to open a separate Spanish bank account.  

IBANs make this possible. Every bank account in Europe is assigned an IBAN that can be up to 34 characters in length, depending on the location of your bank account. They contain a mix of letters and numbers, beginning with a country code that shows where the account is based. For example, Dutch IBANs begin with “NL”, French IBANs with “FR”, and German IBANs with “DE”. 

IBAN discrimination impacts whether customers can actually use the account and payment products you provide. Here’s how that can show up in your business: 

IBAN discrimination remains an active regulatory issue across Europe:  

• In 2025, the European Court of Auditors found that discrimination based on payment account location persists despite the SEPA Regulation being in force since 2014, with France and Spain accounting for the largest shares of reported cases. 
   
• France’s firm position provides an example of national-level responses. The General Directorate for Competition, Consumption and Fraud Control (DGCCRF) and the National Committee for Cashless Payments (CNPS) said that refusing to use a European bank account for transactions in France can result in fines of up to €75,000 for individuals and €375,000 for legal entities.  
   
• There have also been recent enforcement actions. In February 2026, the Italian Competition Authority fined one company €800,000 after finding that it refused to accept Direct Debit payments on non-Italian SEPA IBANs, or accepted them only under more burdensome conditions than for Italian IBANs. 

Reporting remains a major challenge when it comes to tracking IBAN discrimination. Customers are encouraged to raise complaints to the relevant national competent authority, while the European Commission also collects feedback to monitor the issue across the EU.  

But before customers can report IBAN discrimination, they need to recognise it. In some cases, a rejected IBAN may appear to be a failed payment or another frustrating banking issue, rather than an unlawful refusal to accept a valid SEPA account. 

In response, a coalition of fintechs took a proactive approach. Firms including Wise, Revolut, Raisin and N26 have come together to help tackle this issue, encouraging customers to report any ongoing IBAN discrimination at Accept my IBAN, with the anonymised data passed on to the relevant authorities and the European Commission. Starling Bank, Revolut, and Wise have also created letter templates for their customers to use in case they need to raise a formal complaint. 

IBAN discrimination is ultimately caused by the organisation refusing the account, not by the bank or fintech that issued the IBAN. This means that no banking partner can guarantee that every platform or third party will follow SEPA rules correctly. 

But the infrastructure you build on still matters. When customers can’t fund accounts or receive payouts, they usually don’t know which third party rejected the IBAN. They come back to you. Without clear payment visibility and the right account setup, your team is left trying to diagnose problems it can’t easily see or control.  

When offering European account details, look for infrastructure that can support: 

• Real-time payment notifications and status visibility through APIs. If a payment fails or gets delayed, your team needs to understand what happened quickly. Webhooks and API-based updates can help you track payment status, surface updates in your own product, and provide customers with answers that may help rule out IBAN discrimination. 
   
• SEPA Credit Transfer and SEPA Instant access through one regulated partner. This helps you support euro deposits, withdrawals, and payouts without becoming a direct scheme participant yourself or managing multiple providers for basic European payment coverage. 
   
• European account details that support cross-border use without local workarounds. SEPA rules already require cross-border euro payment acceptance, but real-world payment processes don’t always work as intended. Find a provider that can demonstrate its account infrastructure works well across countries. 
   
• Account structures that support deposits, withdrawals, payouts, and Direct Debits at scale. As volumes grow, you need to track money clearly across customers, use cases and balances. Virtual account structures can help simplify reconciliation and reduce manual matching work. 

ClearBank is an EU and UK-authorised B2B bank built specifically to support regulated financial institutions. We hold over £18bn in client deposits and 17m accounts. ClearBank Europe is based in the Netherlands with a branch in France. 

Euro client funds are securely held at De Nederlandsche Bank and the European Central Bank, with sterling client funds at the Bank of England. 

Here’s why companies like BCBGroup, ByBit EU, and Volt work with ClearBank Europe.

When ClearBank was deciding on a European base, account acceptance was one of the factors we considered. While IBAN discrimination still requires broader industry action, our Netherlands-based European bank allows us to provide Dutch IBANs designed to support cross-border euro payment flows. 

This makes your banking more practical than setting up separate local accounts and IBANs to minimise discrimination. It can help keep your account infrastructure simpler as you expand, while still giving customers account details designed for cross-border euro payment flows.  

While this doesn’t guarantee that every third party will always correctly accept every IBAN, it’s a helpful tool in the fight against discrimination.

ClearBank Europe gives businesses access to SEPA Credit Transfer and SEPA Instant through a single API. This means you can support euro deposits, withdrawals, and payouts without taking on the complexity of becoming a direct scheme participant yourself.  

Direct scheme participation can require significant operational and compliance investments. You need to manage scheme access, settlement, testing, resilience requirements, and ongoing rule changes. By working with ClearBank Europe, you can access the relevant European payment schemes indirectly, while ClearBank manages scheme access and settlement in the background.  

We also offer T2 access if you’re looking for the eurozone’s real-time gross settlement system for high-value euro payments, and major UK payment schemes if you’re working in the UK (Faster Payments, CHAPS, Bacs). Verification of Payee is also built into our API to verify account details before payments are sent.

Account acceptance is only one part of the customer experience. Your teams also need visibility into payment statuses and account activity, so they can keep customers informed and reduce manual operations when something doesn’t go as expected. Our API’s webhooks can give these notifications automatically, even within your own systems.  

ClearBank’s API-first infrastructure is built for high-volume payment operations. We built our systems with active-active architecture and dynamic failover, so payments are automatically rerouted in the event of a system failure. That delivers a speedy customer experience even with spikes in transaction volumes.  

You can also scale using virtual account structures to assign account details to specific customers, use cases, or balances. This helps your team track funds and simplify reconciliation across payments, improving speed and visibility at scale. 

Fiat Republic, a banking and payments platform for digital asset businesses, became the first client to go live on ClearBank Europe’s SEPA Indirect product. 

Through the partnership, Fiat Republic offers customers virtual IBANs issued by ClearBank while operating under its own BICs. This allows Fiat Republic to keep control of its brand and customer experience while accessing SEPA payments through ClearBank’s infrastructure. 

ClearBank manages scheme access and settlement, reducing the complexity Fiat Republic would otherwise face if it became a direct participant itself. As a result, Fiat Republic can provide faster access to euro payments and a more resilient cross-border payment experience for its clients. 

For businesses operating in complex or higher-risk sectors, this is the type of infrastructure that matters. The right banking partner should help you access payment schemes, support scalable account structures and maintain a strong customer experience without adding unnecessary operational burden. 

“We're thrilled to announce our integration with ClearBank to launch Agency Banking. By operating under our own European BICs and using our own IBANs, we're taking a huge step towards operational autonomy. This partnership provides redundancy to existing rails and a seamless, independent experience for our clients.” –Adam Bialy, Founder & CEO, Fiat Republic 

Read the full case study: ClearBank enables faster euro payments as Fiat Republic becomes the first live client on SEPA Indirect 

IBAN discrimination can turn a valid SEPA account into a failed payment or a lost customer. In addition to consumer rights issues, it can become an infrastructure issue and customer experience problem. 

While IBAN discrimination won’t be solved by one business or banking partner, your infrastructure choices still matter. The right banking partner can help you support cross-border euro payment flows and give your team clearer visibility when payments fail or need attention. 

ClearBank Europe helps fintechs, payment institutions and businesses across Europe access SEPA Credit Transfer, SEPA Instant, and account infrastructure. If you’re looking to build reliable euro payment flows with a regulated, API-first banking partner, get in touch with our team.