The SEPA Direct Debit Scheme was introduced throughout Europe in November 2009. Financial institutions in the EU are required to participate in the scheme within a year. The national procedures – in Switzerland LSV+ and BDD from the banks and Debit Direct from the PostFinance – will remain in existence for the time being.
The main advantages of SEPA direct debits
- Standard direct debits in 32 countries throughout Europe
- Internationally standardized processes, terms and formalities
- Separation of funds from the flow of information (prenotification, account is debited on the due date)
- Continuous mandate reference is also possible for refunds
The SEPA Core and the SEPA B2B Direct Debit Schemes
The basis for the processing of SEPA-conforming direct debits for the private customer sector (Business to Customer or B2C) is the SEPA Core Direct Debit Scheme Rulebook. It defines the internationally applicable processes, terms and formalities (e.g. mandate administration, one-time and recurring debits) and among other things stipulates that:
- debtors must be granted the right to object;
- the prenotification of an upcoming debiting of the debtor by the creditor is required;
- clearly defined chargeback processes (R-transactions: returns, revocations, reversals, refunds, rejects) exist, and;
- the transactions are processed using standard formats (ISO 20022) and data content (IBAN and BIC).
The SEPA Business-to-Business Direct Debit Scheme will be used for business customers as creditors and debtors and essentially differs from the SEPA Core Direct Debit Scheme in that:
- the debtor must be a bank or a business;
- the debtors need not be granted the right to object;
- no refund is possible once the debtor’s account has been debited, and;
- shorter terms can be used.
SEPA direct debits for financial institutions in Switzerland and Liechtenstein
Financial institutions in Switzerland and Liechtenstein are able to process SEPA direct debits on schedule since November 2009. Participation in the SEPA Direct Debit Scheme requires, among other things, new contracts, new creditor identification numbers (Creditor Identifier) and new direct debit authorizations (mandates). Mandates are prerequisite to be able to conduct debiting of the debtor. The debtor thereby authorizes the creditor to directly debit his/her account at the financial institution provided.
Financial institutions that intend to participate in the SEPA Direct Debit Schemes must submit the following forms in Word format filled in, printed in color, and duly signed to the National Adherence Support Organisation CH/LI, c/o SIX Interbank Clearing Ltd, Operations Center, P.O. Box, CH-8021 Zurich:
The signing of the contractual agreements requires that the financial institution participates in a SEPA-compatible Clearing- and Settlement Mechanism (CSM).
After formal checks of the documents supplied, SIX Interbank Clearing will forward the necessary documents to the EPC. The EPC will acknowledge their receipt and notify, in writing the individual financial institution whether the application is approved or refused.
SEPA Core Direct Debit Scheme Rulebook
