SEPA direct debit: how to set it up?

SEPA direct debit is an efficient payment method, particularly for recurring invoices. The SEPA mandate materializes the consent of the buyer (the debtor) to be debited at the due date of the invoices.

The main interest for the seller (the creditor) is that he controls the payment order sent to the debtor's bank. It thus makes it possible to avoid late payments as soon as the customer's bank account is sufficiently funded. It is therefore a preferred method of payment with trusted customers or when a sales security tool is in place (credit insurance, bank guarantee on first demand, etc.).

Other advantages of SEPA direct debit

In addition to payment at invoices' due date, it facilitates the management of receipts in Accounts Receivable. The transaction is fully managed by the creditor so the reconciliation of the payment received and the invoice is greatly simplified.

In the event of recurring invoicing on fixed amounts, it is possible to program a corresponding recurring direct debit, which further simplifies administrative management.

Implementation of SEPA direct debit

1. The company wishing to use this means of payment must first obtain an SCI number (SEPA Creditor Identifier) ​​from its own bank. The number is issued by the National Bank of the creditor's country and will be identical for all SEPA direct debit mandates created.


2. Creation of a UMR (Unique Mandate Reference) for each SEPA mandate carried out, that is to say for each customer. This number of up to thirty-five characters must be unique within each SCI number.


3. Creation of the mandate itself, integrating the SCI, the UMR and the contact details of the creditor and debtor (in particular the latter's IBAN). The mandate is signed by the debtor, then sent to the seller's bank in a dematerialized manner in most cases. The latter in turn transmits it to the customer's bank.


4. The customer must be systematically informed before each debit of the amount withdrawn, with the date and amount of the transaction and the invoices paid.


5. If there is no objection, the seller can present a SEPA direct debit order to his bank. The customer is debited on the transaction date.


6. End ... unless the debtor (if he's not a company but a consumer) disputes the transaction for which he has a period of thirteen months! Opposition to the debit cancels it altogether. The creditor is debited and the debtor credited.

In the panel of credit manager tools, the direct debit is very interesting and makes it possible to gain in efficiency in the management of the trade receivable and contributes to an efficient debt collection. It nevertheless presents a risk of opposition from the consumer and is therefore to be favored with trusted customers.

SEPA Direct Debit Mandate Model

Download a SEPA Direct Debit mandate model.