Sent in Ten Seconds: Early Evidence on the Impact of the EU Instant Payments Regulation in Luxembourg

This paper provides an empirical assessment of the impact of the European Union’s Instant Payments Regulation (IPR) on the use of instant credit transfers in Luxembourg. Using monthly payment service provider (PSP)-level data on cus-tomer credit transfers sent between 2022 and 2025, the analysis examines whether the IPR affected sending behaviour following its entry into force in January 2025 and ahead of the October 2025 mandatory sending deadline. The empirical strategy com-bines difference-in-differences and dynamic event-study models with complementary approaches, including an interrupted time series and a Generalized Synthetic Con-trol Method. Payment institutions and electronic money institutionsare used as a control group.
Between January and October, PSPs subject to the October IPR deadline show an immediate and statistically significant increase in the share of instant credit transfers sent, rising from roughly 0.8-1 percentage point in early 2025 to about 1.5-2 percentage points by late 2025. These effects correspond to several hundred thousand additional instant credit transfers per month due to the IPR, suggesting early operational adjustment and accelerated adoption of instant payments among PSPs in Luxembourg.
Keywords: retail payments, instant payments, panel study, event study, differ-ence in differences, generalized synthetic control
JEL Classification: C14, C44, E42, E58, G21, L86