The way that payments work through SEPA is that the merchant pulls the money from your account. Legally they require a "mandate" - this can be as little as a handwritten signature on a document.
Security is essentially provided by easy reversal and strong penalties for abuse.
I've often wondered whether payments providers entering the blockchain space (like Visa/Mastercard) would act as trusted intermediaries for dispute resolution. Kind of a 2-of-3 multisig to disperse the funds in escrow.
Infact you could implement exactly what you suggest in a similar way.
And I actually use crypto for payments more than most people. I used some just last week to buy a replica rolex from a chinese dealer because they gave a better price than credit cards.