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SEPA direct debit

SEPA direct debit

Paperless direct debit is one of the most popular payment methods in Germany. It is an interesting option for many online shops due to the low costs and the fact that the majority of German end customers prefer this payment method. However, please note: If you decide to accept payments via SEPA paperless direct debit, you should be aware of the potential risks involved. Paying by direct debit, or rather with your debit card, is the norm in retail shops these days. When an end customer purchases something in a shop with their debit card, they sign a direct debit mandate that permits the shop to debit their bank account. Direct debits are also a popular payment option in online shops. However, as it is often difficult to authenticate the end customer in the e-commerce business, direct debits harbour some risks for merchants.

End customer rights

A customer can cancel a direct debit without giving a reason up to eight weeks after placing the order. If the end customer has not physically signed a direct debit mandate, the order can be cancelled up to thirteen months after it was placed.

Security in the e-commerce business

Merchants can implement various system security measures to make this payment method slightly safer. The respective shop system may already offer some of these measures which then simply have to be integrated into the ordering process. Please ask your online shop developer about this!

Examples for increasing SEPA direct debit security

  • Offer SEPA paperless direct debit to existing customers only, or to customers who have ordered from you in the past
  • Only offer this payment method for orders up to a set value
  • Only offer this payment method to customers who are based in Germany
  • Ask the purchaser to send you a signed direct debit mandate
  • Consider extended risk management measures that do attract charges
 

Agreements with your bank

To be able to offer SEPA paperless direct debit to your customers, you should sign the following agreements with your bank:

  • Authorization to collect direct debit payments on your behalf
  • Consent to participation in the paperless exchange of data involving data processing service centres.

We are happy to assist you with the setting up procedure.

Payment methods

Advantages for the customer

  • Cost-efficient
  • High market share in Germany
  • Welcomed in the B2B business
 

Disadvantages

  • Additional measures must be taken to increase security
  • End customer rights in the event of no mandate