SEPA

SEPA (Single Euro Payments Area) is an area comprised of 34 European countries in which payment transactions denominated in euro are being standardized. Starting on the 1^st of February 2014, the old national bank transfer and direct debit systems are replaced by the standardized SEPA Credit Transfer and SEPA Direct Debit.

SEPA provides

• SEPA direct debit (collect money from customer)
• SEPA credit transfer (refund money to customer)
• in 34 countries
• in EUR currency.

IBAN/BIC

For you as an online merchant, this change will affect not only direct debit payments, but all bank account-based payment methods. From now on, bank account information must be provided in IBAN/BIC format. This applies to your customers' accounts as well as to your own. All German bank account details of our merchants will be automatically converted by us. However, if you use a foreign bank account, we will have to ask you to take care of this transition yourself.

For payments by wire transfer, invoice, or prepayment, the IBAN/BIC of your merchant account is sufficient to receive payments. The IBAN/BIC will also be required for refunds.

PAYONE has adapted the processing of bank statements for IBAN/BIC in such a way that the automatic allocation of transactions and return debit notes is still possible.

All account details for accounts with German financial institutions are automatically converted to the IBAN/BIC format during a transaction. This means that the account details of existing customers will remain unchanged in our system until a transaction is performed. Details for accounts with foreign institutions cannot be converted automatically (see below).

Converting account number/sort code into IBAN/BIC

We will generate the IBAN and BIC from the account number and sort code provided, where required for a transaction, for both existing customers and newly submitted account details for German accounts. We will also complete the BIC if only an IBAN was submitted. This allows you to use the "IBAN only" procedure that was officially introduced in Germany on February 1, 2014. We do not offer this service for accounts with foreign institutions. For German accounts, PAYONE has a conversion rate of over 99% of all valid bank codes (excluding obsolete or deleted bank codes).

We will decompose the IBAN/BIC into the country-specific account details (BBAN, in Germany: account number/sort code) for both domestic and foreign bank accounts, ensuring that the record in our system always contains both IBAN/BIC and BBAN. All payment information provided in IBAN/BIC format prior to the official SEPA migration will be processed correctly without the risk of rejected payments due to missing account information.

Bank account check

The bank account check (request "bankaccountcheck") is extended by the above conversion. You will receive the converted account data with the response. The same applies to the new "managemandate" request (see below).

SEPA Direct Debit

SEPA requires a number of changes in the processing of direct debits. With the expansion of our interfaces and the extended functions on the PAYONE platform, we offer you the possibility to request individual, customized SEPA direct debits. This ranges from the simple processing of SEPA direct debits without the need to adapt your interfaces, to a full SEPA service that includes obtaining mandates as well as generating and managing mandate PDFs.

Creditor ID

The Creditor ID identifies your company to the end user and is displayed on the end user's account statement. The Creditor ID is also required to obtain a mandate, as mandates are always created for a specific beneficiary or creditor.

By using the PAYONE Collection Service, you will be automatically assigned a business identifier of PAYONE's own creditor IDs, which will take care of all the necessary processes on our end.

If you process direct debits via your own accounts, please forward your creditor ID to PAYONE. This information is required in conjunction with the mandate reference for processing your direct debits.

SEPA mandate retrieval

In general, you are free to adapt the retrieval process for your SEPA mandates according to your own requirements. It should be noted, however, that there are certain rules governing the retrieval of mandates. Please consult your primary financial institution to determine the exact format for obtaining your mandates.

PAYONE offers a mandate retrieval procedure that meets the requirements of the German banking industry for SEPA mandates (telecommunications-based transmission complying with the requirement for written documentation according to article 127 paragraph 2, 126 b – German Civil Code). This procedure has been duly examined and found to comply with all relevant legal requirements. Furthermore, PAYONE has aligned this procedure with its primary banking partners.

Please be advised that the legal status of obtaining mandates in online trading will remain uncertain in the coming years. Accordingly, you are advised to consult with your primary financial institution to ascertain whether it adheres to the procedure described herein or requires the use of a paper-based mandate. Please be advised that, in any event, the onus is on you, as the payee, to provide proof and evidence of the existence of a mandate that was authorized by the payer. Accordingly, we cannot guarantee that the electronic mandate will be recognized by the debtor's bank in the event of a dispute. In this instance, the timeframe for returning goods is extended from eight weeks to 13 months. This is essentially the current practice for electronic direct debit.

PAYONE offers a comprehensive suite of services for processing SEPA direct debits, including:

Mandate reference generation

In the event that the merchant's API does not transmit the requisite references, PAYONE will automatically generate them. PAYONE exclusively utilizes recurring mandates. Please be advised that if you use your own mandate references, PAYONE will only store one mandate reference for each individual account (IBAN). Please note that our system will reject any submission of the same account with a different mandate reference and issue an error message. Should you choose to have PAYONE generate your mandate references, our system will automatically verify the availability of a valid mandate for each IBAN and, if necessary, create a new mandate.

Please note that for PPS merchants, these mandate references are always automatically generated and must not be transmitted with the request. Please note that it is not possible to use both PPS and your own mandate management.

Determination of SEPA lead times

In accordance with the SEPA regulations, two different lead times are permitted for direct debits: five days for initial debits and two days for subsequent debits. Direct debits between two German credit institutions will be processed using the "COR1 procedure," reducing the lead time to a single day. Please contact your primary bank to ascertain whether and when it will support the COR1 procedure. The stipulated lead times are expressed in international banking days, also known as TARGET2 days. Please note that an additional regional banking day must be added for the submitting bank. PAYONE will ascertain whether the mandate is an initial or subsequent direct debit and will calculate the corresponding lead time.

Mandate text generation in HTML

PAYONE utilizes the "manage mandate" request to generate mandate texts in the consumer's preferred language (currently German or English) for display during the ordering process, prompting the consumer to confirm the mandate. These texts comply with the requirements set forth by the European Payment Council (EPC). Please refer to the Appendix for PAYONE's default mandate text.

Mandate text generation in PDF format

Upon commission of the product "SEPA Mandates as PDF," a PDF containing the mandate content in the language of the consumer (currently German or English) will be generated for each newly created mandate. The texts comply with the requirements set forth by the European Payment Council (EPC). Please refer to the Appendix for PAYONE's default mandate text.

The mandate is stored on the PAYONE Platform, which allows users to retrieve it at any time using the "getfile" request.

Please be advised that a fee will be applied for the generation of PDF mandates. Please be advised that PAYONE will only store one mandate per account (IBAN). Should you request a further mandate for the same account, the system will not generate a new mandate and there will be no additional charge.

Using the Invoicing module for creating pre-notifications

If you have commissioned our Invoicing module for your billing processes, you may use these invoices for dispatching pre-notifications. If you utilize PAYONE's default invoice template, the requisite SEPA data, including the creditor ID, mandate reference, and posting date, will be automatically incorporated. If you intend to use a custom template, please provide us with a sample when ordering the service so that we can make the necessary adjustments.

Mandate administration options

There are various approaches that can be taken with regard to mandates. The options outlined here represent a typical process in the retail sector, specifically in the context of goods shipment. While a content provider's process may vary slightly, the SEPA functions remain consistent. For more detailed information on the various processes and requests, please refer to the sequence diagrams in the Appendix.

SEPA direct debit with the PAYONE procedure for mandate retrieval

If you are utilising the full functionality of the PAYONE mandate administration, you can retrieve SEPA-compliant direct debits (see above). PAYONE complies with all specific SEPA requirements.

The sequence is as follows:

1. The consumer makes a selection from the products available for purchase in the online shop operated by the merchant.
2. The consumer provides their personal address and payment information.
   
   1. Please be advised that the merchant system will transfer customer data with the request "managemandate" to PAYONE. Please note that no SEPA-relevant data are required. In the event that the merchant provides a mandate reference, PAYONE will utilize this information. In the event that no mandate reference is provided, PAYONE will generate a new one automatically.
   2. PAYONE performs a review of the payment data. In the absence of a mandate text linked to this account, the system will generate a "floating" mandate comprising a mandate reference and a mandate text in the consumer's language in HTML format.
   3. In the event that a mandate is already in place, the status "active" will be communicated. The steps for retrieving and storing the mandate, as outlined below (items 3 and 4), will not be necessary in this case, eliminating the need for the consumer to acknowledge the mandate.
3. The SEPA-compatible mandate text is presented to the consumer for their review and confirmation.
4. The consumer confirms their acceptance of the mandate retrieval and proceeds with the ordering process.
   
   1. The merchant system transmits the aforementioned mandate reference to PAYONE with the subsequent request (e.g., "preauthorization"), which serves as the consumer's authorization of the mandate.
   2. In the event that a merchant has commissioned the product "SEPA mandates as PDF," PAYONE will also create a mandate PDF and save it on the PAYONE Platform.
5. The consumer will receive the mandate in PDF format.
   
   1. In the event that PAYONE has generated a mandate (as outlined above), the merchant system is able to utilise the "getfile" request to retrieve this mandate and employ it for subsequent processes (such as providing it for download to the consumer).
6. Once the product has been dispatched, the merchant initiates the payment process.
   
   1. The merchant is responsible for initiating the payment process, which may be initiated by sending a "capture" request. Please note that no SEPA-relevant data are required.
   2. PAYONE will calculate the posting date and collect the direct debit.
   3. PAYONE transmits all data required by the merchant for a pre-notification via the server API.
   4. In the event that the merchant has commissioned the invoicing module, PAYONE will issue the invoice with the pre-notification to the customer.

SEPA direct debit with own mandate retrieval

If you would prefer to retrieve the mandates yourself, you may use the server API as described below.

1. The consumer selects a product in the merchant's online shop.
2. The consumer provides their personal address and payment information.
   
   1. The merchant will then retrieve the SEPA mandate from the end customer using their own system and requirements. This also entails defining the mandate reference independently.
3. The consumer completes the order.
   1. The order is transferred to PAYONE using an API request (e.g. "preauthorization"). The merchant includes the above-mentioned mandate reference in the request.
   2. If no mandate information has been stored at PAYONE for the transferred account details, the mandate is saved with the provided mandate reference on the PAYONE Platform.  If the merchant has commissioned the product "SEPA mandates as PDF", PAYONE will also create a mandate-PDF and save this on the PAYONE Platform.
   3. No new mandate will be generated if there already is one available.
4. The merchant dispatches the product and initiates the payment.
   1. The merchant initiates the payment (e.g. using the "capture" request). No SEPA-relevant data have to be provided.
   2. PAYONE will calculate the posting date and collect the direct debit.
   3. PAYONE transmits all data required by the merchant for a pre-notification via the server API.
   4. If the dealer has commissioned the Invoicing module, PAYONE will send the invoice with the pre-notification to the customer.

SEPA direct debit with automatically generated mandates

In the event that PAYONE is responsible for generating the mandate reference, the process is analogous to the one previously outlined under "SEPA direct debit with own mandate retrieval." The merchant is provided with all relevant data to ensure a SEPA-compliant direct debit process via the server API. PAYONE is fully compliant with all technical requirements for SEPA direct debit submission and mandate referencing using this procedure. Please be advised that it is your responsibility to ensure that the mandates from your consumers are retrieved in a SEPA-compliant manner when using this procedure.

1. The consumer selects a product in the merchant's online shop.
2. The consumer enters his or her personal address and payment information.
3. The consumer completes the order.
   1. The order is transferred to PAYONE using an API request (e.g. "preauthorization"). The merchant does not transmit any SEPA-relevant data.
   2. If there is no mandate for the transferred account details on the PAYONE Platform, the system will generate a new one. If the merchant has commissioned the product "SEPA mandates as PDF", PAYONE will also create a mandate-PDF and save this on the PAYONE Platform. 
   3. No new mandate will be generated if there already is one available.
4. The merchant dispatches the product and initiates the payment.
   1. The merchant initiates the payment (e.g. using the "capture" request). The merchant does not transmit any SEPA-relevant data.
   2. PAYONE will calculate the posting date and collect the direct debit.
   3. PAYONE transmits all data required by the merchant for the mandate and the pre-notification via the server API.
   4. If the dealer has commissioned the Invoicing module, PAYONE will send the invoice with the pre-notification to the customer.

More options

It is also possible to utilise the various options and requests on a standalone basis. As an example, you may choose to utilize the "managemandate" request without subsequently generating and saving the mandate as a PDF file. Alternatively, the product "SEPA Mandates as PDF" can be used without first generating a "floating" mandate using the "Manage Mandate" request.

Request "managemandate"

The "managemandate" request offers the following functionality:

1. Bankaccount check: The transmitted account details are validated.
2. IBAN converter:
   1. German bank account details with account number/sort code are automatically converted into the IBAN/BIC format. The converted account data is transmitted via the API. This allows you to display them to the end customers for verification and information.
   2. Account details provided in the IBAN/BIC format will be complemented with the country-specific account details (BBAN, in Germany: account number/sort code).
3. Verification whether a mandate has been stored for these account details in the past.
4. Generation of a new "floating" mandate with a mandate text in the consumer's language in case no mandate is found.

Please note that if the mandate reference of the "floating" mandate is resent for the subsequent request, this mandate will be stored permanently. In the event that no subsequent request is sent (for instance, if the consumer cancels the purchasing process), the "floating" mandate will be deleted after a period of two hours.

Subsequent requests may be one of the following:

• preauthorization
• authorization
• createaccess
• vauthorization
• updateuser

Please note that a "bank account check" is performed during this request, which will result in the same cost per call as the request "bank account check" itself. Please refer to the API documentation for a description of the parameters.

Please refer to the Appendix for a sequence diagram illustrating the mandate.

The request "getfile"

To download the mandate as a PDF from the PAYONE Platform, please use the "getfile" request. Please note that the PDFs must have been generated previously in order for this to be possible. This is done during the generation of a new mandate if the product "SEPA Mandates as PDF" has been commissioned.

Please be advised that this request is free of charge. Please refer to the API documentation for a description of the API parameters.

Please refer to the Appendix for a sequence diagram illustrating the mandate.

Check list: What do I have to do?

• If you are utilising the PAYONE Payment Service (PPS), you are not required to possess your own creditor ID for the processing of direct debits via PAYONE. A business identifier of PAYONE's creditor IDs will be automatically assigned to you.
• If you are not using the PPS, you will have to provide your own creditor ID for using the direct debit procedure. You can request your own creditor ID at the German Central Bank at https://extranet.bundesbank.de/scp/.
  Additionally, this is a prerequisite for working with the new requests for mandate administration in test mode.
  
  • Should you wish to use the direct debit procedure, please contact your principal bank to discuss a debt collection agreement.
  • Kindly confirm with your bank whether direct debits are executed automatically or require prior authorization via an accompanying note to the transferred media.

• We kindly request that you provide us with the IBAN/BIC information for your accounts. This is to confirm that PAYONE has automatically converted your bank accounts held at German financial institutions to the IBAN/BIC format and sent you a corresponding overview. 
• It is now time to decide on the nature and scope of the SEPA implementation.
• Plan the adaptation of your interfaces.
• To enable the extended SEPA response data, navigate to the PMI under Configuration, Payment Portals. It is possible to select different configurations for this data, for use in test mode and for live mode, in order to adapt your test systems as required.

FAQ – Frequently asked questions and answers

Appendix: Default mandate texts

Mandate text German

Mandate text English