European Direct Debit

Would you like to pay all your bills to companies throughout Europe, easily and via direct debit? This is the objective of the European direct debit (or SEPA direct debit).

Whereas the current local direct debit product allows you to issue collections in your country only, the European direct debit provides you with the possibility of collecting in the whole SEPA area (28 countries of the European Union +  Lichtenstein, Iceland, Monaco, Norway, Andorra, Vatican City State and Switzerland) under the same properties as domestic collection.

Thanks to the harmonisation of European direct debit’s general terms and conditions, you will have the opportunity to manage your cash management more efficiently, instead of dealing with different conditions and pricing according to the Bank for your local direct debits.

This new European direct debit system intends to replace national direct debit systems. Luxembourg’s national system (DOM2009) will cease to exist on 1 February 2014 at the latest.

The main features of the European direct debit are:

For legal entity debtors, 2 types of European direct debit are available: standard direct debit (or “core”) or Business-to-Business (B2B) direct debit domiciliation.

The standard or “core” direct debit

This type of direct debit is designed for creditors with both consumer and non-consumer (professional) debtors.

The debtors have an unconditional right to a refund for eight weeks, running from the date on which their accounts are debited.

The “Business-to-Business” (B2B) direct debit

This type of direct debit is designed solely for creditors to collect bills issued to non-consumer (professionals) debtors.

There is no unconditional right to a refund with this type of direct debit.

With www.ingsepa.com, ING Commercial Banking is helping companies to make the transition to SEPA

From 1 February 2014, national direct debit systems will be replaced by SEPA direct debits.

Payments organisations based in SEPA countries will carry out their euro-denominated payments and collections under the same conditions across the SEPA zone and just as easily as in their own country.

Companies will be able to improve their financial value chain and move towards more centralised cash management tahnks to standardised rules, faster payements and simplified cash flows.

The significance of these implications will depend on the size of the company, its working methods, the nature of its operations and the payment systems it uses. 

The challenge therefore lies in completing a successful transition to a 100% SEPA environment without any data loss and without losing control of the situation, while taking advantage of the benefits of this change.