SEPA Direct Debits

politicoo

Question to all businesses that receive payment via Direct Debit.

From 1st Feb 2014 onward under the new SEPA (Single Euro Payments Area) legislation it is going to be possible for anyone who pays via Direct Debit to request a, no questions asked, refund of the Direct Debit up to 8 weeks after the initial DD funds were transferred.

This is, most likely, to be long after goods have been delivered and in the precarious situation that we are in economically a lot of businesses may looka to take advantage of this situation.

I work for a Wholesaler, many of who's clients pay by Direct Debit and am very concerned that clients will revoke their prior Direct Debits and either liquidate, go into receivership or simply argue with you about monies owed.

The business is a high turnover but unbelievably low margin one and therefore one client taking 8 weeks worth of Direct Debits back at the stroke of a pen would leave us in big trouble. And yet, Credit transfers into our account can't be trusted (forged cheques, bounced cheques etc.).

I'm just wondering how others might handle this situation.

Many thanks
P

Mr Clonfadda

you need to try and look at a way of them paying you and not you taking their money.

If they pay you they have only 24 hours to recall payment

TheCostumeShop.ie: Ronan

Just update your contracts with customers on Direct Debit, the only reason a customer would revoke the payment would be if they are arguing the payment is not owed / the correct amount. It would be massively illegal to just request the payment be taken back without reasonable cause, so even though they could do it - it would still be illegal to do so in a court of law. Its no different to being paid by credit card really.

Tow

It is actually 13 months they can request back, and they will get it if your paperwork is not in order. The 8 week limit is if you can provide the bank with valid paper work. ie Signed Mandate with correct Mandate Reference (UMR) and Signature Date etc

Business can do Business 2 Business "B2B" Debits. B2B debits cannot be requested back. Unfortunately, at the moment the Irish banks are not implementing this option, but it is available with some of the other banks operating in Ireland. I would imagine they will have no choice but to implement it once SEPA goes fully live.

The SEPA rules/laws come from Europe, they will override any contract you may have. Unpaid bills are a civil matter, so the Guards will do nothing about.

dubal

The 8 week refund is a no questions asked policy, if the customer requests from the bank, they must simply pay up.

First notification to the supplier is with the returns list from the bank stating the money has already been taken out of your account.

Banks planning on making the process involved (i.e. person to person contact) to make it more difficult but they cannot stop the refund.

There will be central bank monitoring etc. but nothing to stop it.

Dubal

Peterdalkey

politicoo wrote: »

Question to all businesses that receive payment via Direct Debit.

From 1st Feb 2014 onward under the new SEPA (Single Euro Payments Area) legislation it is going to be possible for anyone who pays via Direct Debit to request a, no questions asked, refund of the Direct Debit up to 8 weeks after the initial DD funds were transferred.

This is, most likely, to be long after goods have been delivered and in the precarious situation that we are in economically a lot of businesses may looka to take advantage of this situation.

I work for a Wholesaler, many of who's clients pay by Direct Debit and am very concerned that clients will revoke their prior Direct Debits and either liquidate, go into receivership or simply argue with you about monies owed.

The business is a high turnover but unbelievably low margin one and therefore one client taking 8 weeks worth of Direct Debits back at the stroke of a pen would leave us in big trouble. And yet, Credit transfers into our account can't be trusted (forged cheques, bounced cheques etc.).

I'm just wondering how others might handle this situation.

Many thanks
P

http://www.europeanpaymentscouncil.eu/content.cfm?page=sepa_business_to_business_direct_debit_(b2b_sdd). OP it seems pretty clear from this information that you would be covered by the B2B provisions and do not have to worry on that score.

dubal

You are assuming he will be using B2B that isn't supported by everyone!

OP, what mechanism are you currently using for DD?

Regards
Dubal

Peterdalkey

dubal wrote: »

You are assuming he will be using B2B that isn't supported by everyone!

OP, what mechanism are you currently using for DD?

Regards
Dubal

If he is not, or in this case his employer, the next step is intuitive!

dubal

Peterdalkey wrote: »

If he is not, or in this case his employer, the next step is intuitive!

I don't understand the response.

The SEPA DD is either Core or B2B (which I don't believe is available), under Core which is most likely therefore, the above answer from yourself becomes invalid.

Regards
Dubal

Peterdalkey

dubal wrote: »

I don't understand the response.

The SEPA DD is either Core or B2B (which I don't believe is available), under Core which is most likely therefore, the above answer from yourself becomes invalid.

Regards
Dubal

Indeed, if you are correct in your belief and that the same situation still obtains when the system becomes fully operative. Though it would be rather strange to legislate for such provisions with no intention of implementation.