The SEPA B2C direct debit procedure makes it easy for merchants to accept consumers' payments from anywhere in the Euro zone through their online shops.
The BIC (Bank Identification Code) and IBAN (International Bank Account Number), which will replace the account number and sort code, are used as account identification. All payments are processed solely in euros.
What you should know
Creditor identification number
- For merchants to be able to offer SEPA direct debit, they must apply for a creditor identification number (Creditor ID). The Creditor ID, which is a unique identifier that is independent from any specific account and valid throughout the EU, identifies the merchant as the company presenting the direct debit [instruction]. Merchants based in Germany can apply for their Creditor ID by submitting an online form to the German Federal Bank [Deutsche Bundesbank].
- The mandate reference is an identifier individually assigned to a mandate by the merchant. In combination with the Creditor ID, the mandate reference is a unique identifier and makes it possible to clearly identify the mandate in question. The online merchant must choose the mandate reference in such a way that it cannot overlap with any other customer-related identifiers (e.g., customer number, invoice number, member number, etc.).
- The Due Date is the specific date on which the end-customer's account will be debited. Merchants must submit the SEPA direct debit for collection sufficiently in advance to ensure timely receipt by the customer's bank. If a merchant chooses, Wirecard may calculate the due date for the merchant.
- Pre-Notifications have already become an established practice for national direct debit. For SEPA direct debit, the customer must be informed of the amount to be debited and the due date prior to collection of the direct debit. This can be done by means of an invoice or order confirmation for example.
- In addition, online merchants will need to comply with modified time limits for transaction reversal. A SEPA direct debit can be reversed by the end-customer up to eight weeks after the customer's account has been debited. If the direct debit was unauthorized (id: no signed mandate available), the end-customer can reverse the debit up to 13 months after the account was debited. As in the current national direct debit procedures, a (valid SEPA) mandate must obtained by the merchant.
- Wirecard offers fully automated processing of SEPA direct debit payments in all 33 SEPA countries.
- The Wirecard Payment Gateway provides complete backend processing for merchants with their own payment pages. The merchant may also choose to offer SEPA direct debit to its customers using Wirecard's payment page solutions Wirecard Checkout Page and Checkout Page Seamless. In addition, Wirecard is able to process both one-off and recurrent payments (e.g., subscriptions).
- Online merchants who also wish to process SEPA B2B (business-to-business) direct debits can already take advantage of this service directly through Wirecard Bank.
- Wirecard will offer a conversion service to ensure merchants may continue processing. This conversion service will be available for Germany and Austria beyond February 1 2014. It will use an algorithm to convert the currently used account identification (account number and sort code) into the SEPA-accepted IBAN and BIC.
- Beginning March 2014 the conversion service may be used in parallel with SEPA processing during the merchant's SEPA migration phase.