Two and a half years after its launch, there are some major changes planned to the processing of Direct Debit payments under the SEPA Scheme from November 2016.

In the main, the planned changes should make life easier for Originators submitting SEPA XML files.

There are three major changes coming into force and our DEFT application has been updated to handle each of them although two of the changes really require that the systems at the various Retail Banks be updated to handle them.

The changes are:

1. Eliminate the difference between FRST and RCUR transactions

You will no longer be required to submit a FRST transaction before you submit RCUR transactions. FRST and RCUR transactions will effectively be viewed as being the same thing. As a result it is likely that Originators will only submit RCUR transactions in future, even for the first presentation of a new mandate.

This will eliminate problems for organisations who regularly have new Mandates and those who are processing payments on a frequent basis.

2. Shortened Cycle Times

All repeating Direct Debits will be processed “next business day”, whether a FRST or a RCUR. This is great news as you will no longer have to wait 6 days to collect your monies on FRST transactions or 3 days on RCUR transactions.

This change also ties in with the change to treat FRST and RCUR transactions in the same manner.

3. Changes when a Creditor amends their Banks Details

Because the BIC is now optional when processing Direct Debit transactions and also optional so that Debtors may not provide it when authorising a new Mandate, the systems may not know whether a change to the Debtors IBAN might also entail a change to their BIC.

From November, how this is to be flagged in payment files is changing. It doesn’t really impact Creditor’s submitting SEPA XML files provided their software handles the changes properly in the background.

As mentioned DEFT has already been updated to handle each of these new changes. Because the first two changes have an impact on the internal systems used at the Banks, their use and implementation can only be tested by them. Ardbrook will be working with personnel from each of the major Banks to assist in this as required.

Make sure to liaise closely with your Bank particularly in relation to when they will have their own systems fully tested.

And feel free to contact us with any questions you have on the planned November changes – sepa@ardbrook.ie