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EPC Newsletter
Issue 2 - April 2009

SEPA Credit Transfer (SCT) & SEPA Direct Debit (SDD)

SEPA Direct Debit: the Green LightEPC launches SEPA Direct Debit Schemes in November 2009

24.04.09 By Gerard Hartsink

INTRODUCTION AND SUMMARY

On 31 March 2009 the EPC Plenary decided that as of 1 May 2009, it will be possible for banks to sign up for participation in the SEPA Core Direct Debit Scheme and / or the SEPA Business to Business Direct Debit Scheme. Banks will therefore be able to start delivering euro direct debit services as from 2 November 2009. The introduction of the two SEPA Direct Debit Schemes demonstrates the continued commitment of the European banking industry to the creation of one domestic euro payments market and its ability to deliver on time the euro payment schemes that are the foundation of the Single Euro Payments Area. SEPA Direct Debit services offer citizens, companies and public administrations a new and unique opportunity to make euro direct debit payments within and across 31 European countries. Gerard Hartsink comments on the EPC decision.

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European banking industry confirms its commitment to SEPA

With approval of its Roadmap 2004 2010 the EPC Plenary committed to develop the schemes and frameworks that are the basis of the integrated euro payments market. The schemes developed by EPC define sets of business rules and standards that have to be respected when executing SEPA payment transactions. Following the launch of the SEPA Credit Transfer Scheme in January 2008 the EPC now makes it possible for banks to start offering SEPA Direct Debit services as of November 2009.

The launch of the SEPA Direct Debit Schemes represents a major achievement made possible only because of the continued commitment and dedicated work of all EPC members including the payment experts cooperating in the EPC SEPA Payment Schemes Working Group (SPS WG). The members of this Working Group have truly mastered the art of European consensus-building: the SPS WG on a daily basis bridges different payment cultures and customer expectations whilst going through the painstaking process of forging agreement on the countless technical and procedural details that make up a payment scheme. In addition, the work accomplished domestically must be validated: only after continuous consultation with banks and their customers at national level did the EPC Plenary conclude on the business rules and standards of the two SEPA Direct Debit Schemes. Last but not least, the EPC greatly appreciates the continued feedback provided by the members of the European associations of corporates, SMEs, treasurers and consumers represented in the EPC Customer Stakeholders Forum on the evolution of the SEPA Schemes.

EPC calls on public authorities to give support for a successful launch of the SEPA Direct Debit Schemes

The EPC had emphasized the need for certainty as regards the acceptability of a multilateral inter-bank fee arrangement for SDD transactions in the long term. In a joint statement on 24 March 2009 the European Commission and the European Central Bank clarified their position on such an inter-bank fee arrangement applicable to SEPA Direct Debit transactions after October 2012*. The EPC recognises that the principles outlined in the joint statement of the regulators will affect the SEPA banking communities differently due to the fact that banks' existing direct debit business models vary from country to country. This means that some communities are confronted with the obligation to adapt their current direct debit business model significantly as of November 2012.

National and European public authorities must now implement those legal provisions that will allow banks to finalise SEPA Direct Debit.  It is very important that national governments complete transposition of the EU Payment Services Directive (PSD) by 1 November 2009 at the latest.  The PSD provides the harmonised legal environment needed for SEPA-wide operation of the SEPA Direct Debit Schemes. In addition, EU Member States must, where necessary, create legislative solutions to ensure the continued legal validity of existing mandates under the SEPA Direct Debit Scheme. 

EPC invites major billers to take advantage of SEPA Direct Debit services

The SEPA Direct Debit Schemes provide a fast, secure and convenient means of making single or recurrent euro payments. The SEPA Direct Debit Schemes allow customers - for the first time ever - to make both domestic and cross-border euro direct debit payments throughout the 31 SEPA countries. The EPC invites major billers such as tax authorities, insurers, publishers and telecommunication companies, for example, to take advantage of SEPA Direct Debit services and to make this new means of bill payment available to consumers.

* The joint statement of the European Commission and of the European Central Bank of 24 March 2009 is available at http://www.ecb.int/press/pr/date/2009/html/pr090324_1.en.html

Gerard Hartsink is the Chair of the EPC.

Related article in this Newsletter:

The Doors are open. Guidelines for adherence to the SEPA Direct Debit Schemes are now available

Article38




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