Glossary · Payment methods
SEPA Direct Debit
Also called SDD
SEPA Direct Debit lets a supplier collect euro payments from a customer’s account under a signed mandate. Core and B2B schemes give payers different rights.
With SEPA Direct Debit, the customer signs a mandate authorising you to collect from their account. You then send collections on the due dates, telling the customer in advance how much will be taken and when.
There are two schemes. Under SDD Core, available to consumers and businesses, the payer can demand a refund of an authorised debit within eight weeks, no reason needed — and up to 13 months for an unauthorised one. Under SDD B2B, available only when the payer is a business, there is no refund right for authorised debits, and the payer’s bank must confirm the mandate before the first collection.
For recurring B2B invoices, direct debit removes the commonest cause of late payment: the customer having to act. The B2B scheme also removes the risk of a payment being reversed weeks later.
Example
An IT support firm collects €600 a month from 40 business clients under SDD B2B mandates. Each invoice states the collection date, and payments arrive on that date without reminders.