business guide - direct debit v2.0
TRANSCRIPT
Direct Debit Business Guide 2.0
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Table of Contents 1 GlobalCollect Contact Information .......................................... 4
2 Goal and Context ....................................................................... 5
2.1 Overview of important documents ................................................................ 5
2.2 Version History ................................................................................................. 6
2.3 Disclaimer ........................................................................................................ 6
2.4 Suggestions ..................................................................................................... 6
3 General Information ................................................................... 7
3.1 What are Direct Debit payments ................................................................... 7
3.2 Advantages ..................................................................................................... 7
3.3 Disadvantages ................................................................................................ 7
4 How It Works ................................................................................ 8
4.1 General Payment Flow ................................................................................... 8
4.2 State Transition Diagram ................................................................................. 9
5 Coverage .................................................................................. 10
6 How To Get Started ................................................................... 11
6.1 WebCollect Interfaces .................................................................................. 11
7 Processing Direct Debit Transactions ...................................... 13
7.1 Rejections and Refusals ................................................................................ 13
7.2 Payment Processing ..................................................................................... 13
7.3 Reversals and Refunds .................................................................................. 13
8 Matching and Reporting .......................................................... 15
8.1 Reporting ....................................................................................................... 15
8.2 Cut-off Time ................................................................................................... 16
9 Other Activities .......................................................................... 17
9.1 Payment Inquiries ......................................................................................... 17
9.2 Dispute Management ................................................................................... 17
9.3 White Mail ...................................................................................................... 18
10 Prevention of Reversals ......................................................... 19
10.1 Methods Without Risk of Blocking Transactions .......................................... 19
10.2 Methods With Risk of Blocking Some Transactions ..................................... 20
11 Country Specific Information ................................................ 22
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11.1 Austria (AT) .................................................................................................... 22
11.2 Belgium(BE) ................................................................................................... 23
11.3 Switzerland (CH) ............................................................................................ 24
11.4 Germany (DE) ................................................................................................ 25
11.5 Spain (ES) ....................................................................................................... 26
11.6 France (FR) .................................................................................................... 27
11.7 Great Britain (GB) .......................................................................................... 28
11.8 Italy (IT) .......................................................................................................... 31
11.9 The Netherlands (NL) .................................................................................... 32
12 Appendix A: Sample Mandates ........................................... 34
12.1 Austria (AT) .................................................................................................... 34
12.2 Belgium (BE) .................................................................................................. 35
12.3 Switzerland (CH) ............................................................................................ 36
12.4 Germany (DE) ................................................................................................ 37
12.5 Spain (ES) ....................................................................................................... 38
12.6 France (FR) .................................................................................................... 39
12.7 Great Britain (GB) .......................................................................................... 40
12.8 Italy (IT) .......................................................................................................... 41
12.9 The Netherlands (NL) .................................................................................... 42
13 Appendix C: Refusals and Reversal Reasons ...................... 43
13.1 Customer reversed ....................................................................................... 43
13.2 Not Customer Reversed................................................................................ 43
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1 GlobalCollect Contact Information
GlobalCollect Europe GlobalCollect
Planetenweg 43-59
2132 HM Hoofddorp
The Netherlands
Tel: +31 (0)23 567 1500
E-mail: [email protected]
GlobalCollect Americas Three Embarcadero Center
Suite #2900
San Francisco, CA 94111
United States
tel: +1 (415) 975 0969
E-mail: [email protected]
GlobalCollect Asia-Pacific 8 Temasek Boulevard,
#21-04 Suntec Tower Three
038988, Singapore
tel: + (65) 6408 8222
E-mail: [email protected]
GlobalCollect Latin America Av. Alicia Moreau de Justo 846
2nd Floor, Office 11
1107AAR, Buenos Aires
Argentina
tel: + 54 (11) 5272 1189
E-mail: [email protected]
Website Visit the GlobalCollect website www.globalcollect.com for information about the
products and services that GlobalCollect offers. In addition you can watch online
demonstrations of the payment platform and an online shop.
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2 Goal and Context
This document‟s objective is to provide general business and operational information
about GlobalCollect‟s processes and procedures for external use. The Direct Debit
Business Guide is relevant to business managers, operations managers, technical
managers and project managers. The document is part of a range of documents
published by GlobalCollect that contain additional information on technical, operational,
and administrative aspects.
2.1 Overview of important documents
The following set of documents may be relevant.
The Implementation Guides
The Implementation Guides contain an overview of information required from the
Merchant to configure GlobalCollect‟s applications and the guides also provide an
overview of actions to be taken when implementing those applications.
Current Implementation Guides:
Implementation Guide
Application Form
Intake Form
Programmers Guides
The Programmers Guides are technical guides detailing interfaces between Merchants
and both online and offline platforms.
Current Programmers Guides:
Programmers Guide – WebCollect
Programmers Guide – Reporting
Business Guides
The Business Guides give an overview of the basic services GlobalCollect offers. They also
describe procedures relevant to the Merchants.
Current Business Guides:
Business Guide - Card Payments
Business Guide - PayOuts
Business Guide - Risk Management
Business Guide – Invoicing
User Guides
The User Guides are the manual for applications that can be directly accessed by the
Merchant.
Current User Guides:
User Guide - Payment Console
User Guide - Call Centre Application
User Guide - Invoicing
User Guide - Fraud Screening
Administrative Guide
This Guide includes a description of GlobalCollect‟s reconciliation model. It offers in-
depth explanations of reporting periods, cut-off times, identifying references in on- and
offline interfaces and the relationship between operational and financial reports.
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Technical Platform plus Service Levels
These documents contain an overview of the technical setup of the online and offline
platforms of GlobalCollect and GlobalCollect‟s committed service levels.
Network plus Network Glossary
The Network is a dynamic document detailing country and product availability. It is
updated frequently to reflect GlobalCollect‟s processing capabilities and country
presence. The Glossary extensively details all available payment varieties GlobalCollect
offers to Merchants.
2.2 Version History
The most recent versions of GlobalCollect‟s product documentation are available on the
Payment Console. Notification on documentation updates is done through the
GlobalCollect Insider eNewsletter and Payment Console news reel. Please note that this
document is normally updated once per quarter; therefore, it may not fully reflect the
actual situation during this quarter. Adjustments that have been planned during the
quarter are included in this document as often as possible.
2.3 Disclaimer
© 2010 Global Collect Services B.V. All trademarks, service marks and trade names
referenced in this material are the property of their respective owners. The information
contained herein is provided as a courtesy and is for general informational purposes only.
This document is not intended to be a complete description of all applicable rules,
policies and procedures. The matters referenced are subject to change from time to
time, and individual circumstances may vary. Global Collect Services B.V. shall not be
responsible for any inaccurate or incomplete information. The information contained
herein includes, among other things, a compilation of information received from third
parties, and any such information is and shall remain the property of its respective owner.
Nothing contained in this presentation is intended to supplement, amend or modify any
applicable contract, rule or regulation.
GlobalCollect has given extensive attention to the content of this document but makes
no warranties or representations about the accuracy or completeness of it. Neither
GlobalCollect nor any of its affiliates shall be liable for any direct, incidental,
consequential, indirect or punitive damages arising out of access to or use of any
content of this document. Because of the complexity of the process and the right of
Banks to alter conditions, this document can only serve as a description and is subject to
further modifications.
2.4 Suggestions
Suggestions regarding the content of this document are welcome and may be
forwarded to the attention of Product Management at
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3 General Information
3.1 What are Direct Debit payments
A Direct Debit is a way to collect an amount directly from a bank account. It is
considered a pull payment method as the collection of the funds is initiated by the
merchant. The bank account details are provided to the merchant together with a
mandate for the debiting of the bank account. The merchant instructs GlobalCollect to
retrieve the amount due from the bank account at the desired date.
It is typically used to make recurring payments; such as utility bills and subscriptions. Unlike
standing orders, which require the amounts to be fixed, Direct Debits can be used for
varying amounts; the payee can simply indicate a different amount each time. In
countries where setting up authorization for Direct Debit is easy, it can also be used for
one-time payments in the mail order business or even at a point of sale. Direct Debit is a
highly accepted means of payment in Germany and the Netherlands. The payment
method is ideal for recurring low-value transactions.
3.2 Advantages
Cost effective
Optimal for recurring payments
Can be used for both recurring and one-off payments
3.3 Disadvantages
Often a paper mandate is still required from every consumer
Transactions can be reversed even if mandate is in place
Limited real time feedback on transaction
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4 How It Works
In general the process to submit Direct Debit transactions for processing to GlobalCollect
consists of three steps for the merchant:
The collection and submission to GlobalCollect of payment information (bank
account details)
The collection of the signed mandates from the consumer (signed approval) and
subsequent processing of this mandate depending on the local regulations
The request to debit the consumer‟s bank account
In some countries, the paying Banks do not keep records of the mandates. This means
that they are not capable to check whether a mandate has been obtained by the
Merchant. As GlobalCollect does not keep records of the mandates either,
GlobalCollect will always assume that this mandate is in the possession of the Merchant.
The Merchant is in all cases responsible to obtain and maintain the mandates.
Some Direct Debit schemes also require the Merchant to notify the Consumer in advance
of the impending debiting of their account. GlobalCollect does not send out any
notifications to account holders prior to their account being debited. This has to be done
by the Merchant.
Please see section 11 Country Specific Information on the specifics of the mandate
handling and notification requirements per country.
4.1 General Payment Flow
The figure below shows the flow of information and funds that occurs for a Direct Debit.
Figure 1: Direct Debit Payment Flow
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1. Consumer chooses to pay by using Direct Debit and provides bank account
details.
2. Consumer sends authorization for transaction in the form of a mandate
3. Merchant requests to debit the amount from the Consumer‟s bank.
4. If the request is approved the funds are remitted to GlobalCollect‟s bank account
with an attached report detailing the transaction.
5. Funds are remitted to GlobalCollect and statements are gathered to process all
incoming payments
6. The Merchant is informed of the transaction‟s status and if successful the funds are
remitted to his bank account
4.2 State Transition Diagram
During the processing of a transaction, the payment status will change each time the
transaction is updated in GlobalCollect‟s systems. The Programmers Guide provides in
depth information on each status that might be reported for a transaction.
In the diagram below you can see the full process diagram for Direct Debit transactions.
Figure 2: Direct Debit State Transition Diagram
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5 Coverage
Please refer to the Network and Network Glossary documents for the most up-to-date
information regarding the coverage of GlobalCollect‟s Direct Debit Service. Within its
Network, GlobalCollect frequently works with various suppliers (e.g. banks, printers, postal
companies, Telco‟s/ISPs, and so on) for similar services. Within the condition that the end
product is not noticeably different to the Merchant, GlobalCollect may process with
various suppliers simultaneously, switch between suppliers, terminate certain suppliers,
and add new ones. Reasons to change are commonly related to service and/or cost
levels. As they do not have any impact on Merchants, such changes are not
communicated externally.
Currently, GlobalCollect support the processing of Direct Debits in the following countries:
Australia*
Austria
Belgium
Canada*
France
Germany
Great Britain
Italy
The Netherlands
Spain
Switzerland
United States*
* Australia, Canada and the United States are currently being piloted.
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6 How To Get Started
To get started, a Merchant will be allocated a GlobalCollect Account and will have to
be able to start sending and receiving input and report files to and from GlobalCollect.
The Merchant will also receive a SFT (Secure File Transfer) account to upload and/or
download data.
For the processing of Direct Debits it might be necessary for the Merchant to open local
bank accounts. You can see which countries will require you to open a local bank
account in section 11 Country Specific Information below. GlobalCollect will assist in the
process of opening the necessary bank account.
The maximum number of characters available to add a description per transaction on
the Consumer‟s statement varies per country.
6.1 WebCollect Interfaces
The single-interface of WebCollect takes the complexity out of the integration with your
sales channels. WebCollect facilitates payment processing using our highly secure servers
via XML based APIs.
The WebCollect payment processing platform provides a reliable online Direct Debit
submission service. In addition to the advantage of the real time processing, a number of
additional functionalities such as recurring payments, online checks on bank account
information and online reporting are available through WebCollect. Although the
feedback on processing is immediate, the reporting on settled transactions, reversed
transactions, and so forth is done once a day through Secure File Transfer (SFT).
There are four distinct ways to connect to the WebCollect in order to submit Direct Debit
payments.
CustomerLink
CustomerLink integrates GlobalCollect‟s check-out and payment pages within the
Merchant‟s website. A “ready to use” solution that includes usability tested check-out
pages with instructions available in up to 28 languages. The look and feel of the
payment pages can be customized to fit the Merchant‟s branding, while all links to
financial institutions and payment instructions are kept up to date by GlobalCollect.
Additional functionalities include the possibility to send e-invoices as well as customized e-
mails to customers.
MerchantLink
Merchant Link is designed for Merchants who prefer to use their own online shop and
payment pages. With this interface the Merchant is in full control of the end user
experience. Accordingly, the Merchant collects and stores the customers‟ payment
details and has full control over the content, navigation and layout of the check-out
pages. This integration consists of a single XML interface to WebCollect. GlobalCollect‟s
response will indicate if the transaction can be further processed or not.
Hosted MerchantLink
Hosted MerchantLink combines the flexibility of MerchantLink with the convenience and
built-in security of CustomerLink. The check-out process and choice of payment method
takes place on the Merchant‟s website, yet the capturing of the specific bank account
data needed to process the transaction is hosted by GlobalCollect, which also takes
care of the routing to banks and service providers.
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At a glance:
Integration option Order page hosted by Payment page hosted by Feedback page hosted by
CustomerLink GlobalCollect GlobalCollect GlobalCollect
MerchantLink Merchant Merchant Merchant
Hosted MerchantLink Merchant GlobalCollect Merchant
Call Center Application
For call centers that act as a Merchant‟s in or outbound sales channel, GlobalCollect
offers online real time access to the WebCollect platform through the Call Center
Application. Using this web based interface, multi-currency credit card and Direct Debit
transaction details can be entered directly, enabling immediate authorization and
processing.
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7 Processing Direct Debit Transactions
After all the necessary data has been captured to process the Direct Debit and the
mandate has been handled, the Merchant can instruct GlobalCollect to debit the
Consumer‟s bank account.
This is done by issuing a separate API call to the MerchantLink interface.
7.1 Rejections and Refusals
GlobalCollect performs extensive checks on the validity of the information received to
avoid costs from passing on incorrect and/or incomplete information to its Banks, printers
etc. The processing of the files and records may therefore result in records being rejected
by GlobalCollect due to a lack of required data or due to other reasons. GlobalCollect
will report any rejected transaction with the reason for the rejection.
GlobalCollect will bundle all Direct Debit transactions in settlement files that are sent to its
banks for processing. Some transactions can be refused for processing by GlobalCollect‟s
banks due to, for instance, incorrect data that the bank can verify directly. GlobalCollect
will report any refused transaction with the reason for the refusal.
7.2 Payment Processing
Payment reports from banks within the GlobalCollect Network are gathered daily at 09:00
CET. These reports usually contain transactions received by GlobalCollect during the
previous 24 hours. Payments cleared to an account after the cut-off time will be part of
the statement retrieved the following day. The processing of these payment records takes
place on the day of the retrieval of the payment information before 16:00 CET.
If a Direct Debit file has been credited, the individual debit transactions it contains will
automatically be matched to the individual records delivered.
Payments will only be reported as paid after the funds have been cleared on the
GlobalCollect accounts. The clearing time agreed with GlobalCollect‟s banks differs by
bank and varies between 1 and 7 days. Please note that this time span only covers the
period between receipt of the settlement files by the bank and crediting of
GlobalCollect; it does not include time involved in processing and reporting of the
payment by GlobalCollect.
7.3 Reversals and Refunds
After transactions have been settled, some of these might be reversed as what is known
as „bank reversals‟. This can be due to low funds, blocked or closed account, etc. These
reversals are transactions that simply could not be processed by the bank of the
Consumer. GlobalCollect will report these reversals to the Merchant and will deduct
these transactions from the remittance to the Merchant.
GlobalCollect receives 99% of bank reversals within 3 business days. Merchants should
always wait with the fulfillment of the order until after 5 days have passed since the
debiting the Consumers account. This way, all bank reversals have been processed and
the Merchant can safely send out the goods or make the service available. If the
Merchant does not wait and makes the goods or service available immediately, they will
become more vulnerable to fraudulent Direct Debit transactions.
The Merchant should also wait with the submission of refund requests to GlobalCollect
until after the 5 day period of bank reversals have past, otherwise the Merchant is at risk
of crediting the Consumer twice.
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Consumers can reverse the Direct Debit transaction at will. This can be done because
they don‟t recognize the transaction or because they are unhappy with the Merchant‟s
service or goods. GlobalCollect will report these reversals to the Merchant and will
deduct these transactions from the remittance to the Merchant. The time period that
Consumers have to reverse a Direct Debit differs per country. For information on the
reversal policies in the different countries, please see section 11 Country Specific
Information below.
Please note that the banks have 30 days to process these reversals and that this is added
to the above mentioned time periods. Additionally, any Direct Debit that does not follow
the expected pattern for the Consumer, i.e. change in periodicity, unexpected amount,
also falls in the category of unauthorized Direct Debits.
Internally, within GlobalCollect, Direct Debit reversal rates are being monitored.
GlobalCollect‟s partner banks are also being monitored by the Direct Debit authorities.
Therefore, in order to protect GlobalCollect‟s banking relationships and avoid being
closed down because of excessive fraud / reversals; GlobalCollect must ensure that its
Merchants stay below the 5% level for Consumer reversals. If a Merchant exceeds this
reversal level, GlobalCollect may have to suspend Direct Debit processing. GlobalCollect
will alert the Merchant to whether they are being monitored.
GlobalCollect is aware that some of its banking relationships count both customer
reversals and bank refusals when calculating the Merchant‟s overall reversal rate.
GlobalCollect is working with its banks to only look at truly consumer reversals because
refusals corrupt the ratios.
7.3.1 Bank Payments on Direct Debits
Merchants who have selected GlobalCollect for their Direct Debit processing, should be
prepared to receive Consumer initiated bank payments. An example of why the
Merchant should be prepared for this is that after a Direct Debit is reversed the Consumer
can decide to make the payment after all and chooses the bank transfer as payment
option. This is possible as the account number of GlobalCollect will usually be provided by
the bank after a payment was reversed.
The following measures need to be in place: setting up a contract with GlobalCollect for
Bank payments and adjusting the systems to be able to process the daily reports with
bank transfer records included.
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8 Matching and Reporting
Reporting on transactions delivered to and processed on the WebCollect platform will
partly be online. To the extent that online transactions are passed on to or directly
delivered to the BatchCollect platform (for printing, clearing, crediting, debiting etc.),
reporting is as follows.
The Merchant will receive a Payment Report per Account with rejected records, refusals,
payments, reversals, and corrections, on a daily basis before 00.00 CET.
Example of processing steps:
1. Record is received before 07:00 CET on day 1
2. Records are processed and reported on day 1 before 21:00 CET
3. Rejected records and payments are reported on day 2 before 21:00 CET
4. Reversed transactions are received between day 2 and later and are reported
between day 3 and later
In addition to the Report file, the information on those transactions is also made available
on the Payment Console daily as of 21.00 CET.
The daily report file may contain information on various input-files. As the daily report
contains the transactions processed the preceding day no reports are generated on
Saturday and Sunday.
Once reported, the corresponding funds – both debits as well as credits - are available
for remittance. The actual remittance covers the transactions processed on one or more
business days, usually a week.
8.1 Reporting
The Programmers Guide – Reporting describes the reconciliation models for several
payment methods. It provides Merchants with information about the relationship
between the different reports, the way they to reconcile the reported payments and how
to explain the total amount that is remitted to the Merchant every week.
Each transaction and each payment processed by GlobalCollect triggers reports being
created and sent to the Merchant. These reports provide information about the
payments processed and the total amount in different currencies that have been
collected for the Merchant. It helps Merchants to update their own order administration
and reconcile the reported payments with their orders.
8.1.1 Reporting Model
The reporting model of GlobalCollect is a three-layer model:
1. Daily Payment Reports, on individual transaction level
2. Weekly Collection Reports, totals per currency per operational account
3. Weekly Financial Statement, totals per remittance account
8.1.2 Settlement of Payments
The date a payment, reversal or refund is processed by GlobalCollect, determines the
period in which the money will be remitted. The moment of receipt on its bank account
determines GlobalCollect‟s settlement date.
8.1.3 Reconciliation Model
The reconciliation model explains the relation between the moment a payment was
submitted by the Merchant‟s system, the moment it was processed by GlobalCollect and
the moment the payment is reported and remitted. An important parameter is the cut-off
time of WebCollect.
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8.1.4 Reporting Timelines
Summary of processing steps:
1. Payments received in back-office on day X are processed the same day.
2. Payments processed on day X are reported on day X.
Financial reports are made available on Monday morning, reporting the previous week.
During the weekend no payments are processed.
8.2 Cut-off Time
WebCollect uses a cut-off time of 07:00 CET. All transactions that are registered in
WebCollect before 07:00 CET are processed the same day in the back-office of
GlobalCollect. Transactions registered later will be processed the next business day.
The moment a transaction takes place has a consequence on the speed of processing
and settlement of the payment.
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9 Other Activities
In addition to the process described above, there may be additional activities that are
not processed automatically.
9.1 Payment Inquiries
Payment Inquiries, such as inquiries for individual transactions that may have been
received by GlobalCollect but that were not yet reported will only be handled on the
basis of a fully completed online “Payment Inquiry”, which can be generated through the
Payment Console.
Payment Inquiries received before 09:00 CET will be logged, processed and responded to
on the same business day. Inquiries received after 09:00 CET will be handled the next
business day.
If necessary, a Proof of Payment will be requested from the Merchant. The Proof can be
attached as a scan along with the email. As Proof of Payment GlobalCollect will accept:
copy of a bank statement of the Consumer
cash receipt from the bank of the Consumer
Both should contain at least the following items:
currency and amount
date
beneficiary name
account number of beneficiary
If the payment can be identified on the basis of the information in the Payment Inquiry, it
will be matched and reported as usual. The response to the Payment Inquiry contains the
reason why the payment could not be matched without the information provided by the
Merchant. In the event the Merchant provides a valid Proof of Payment but
GlobalCollect has not received and/or cannot identify the payment, it will process and
report the payment as normal.
The Merchant should provide contact details in their communications with Consumers so
that inquiries will be directly addressed to the Merchant without interference from
GlobalCollect. In the case that GlobalCollect receives Inquiries by email from Consumers,
these will be logged, and sent to the merchant as per the contact details provided to
GlobalCollect.
9.2 Dispute Management
Consumers may dispute a transaction through their Bank. The Consumers‟ Bank will
contact the Bank of GlobalCollect which, in turn, will contact GlobalCollect. Although
GlobalCollect will only mediate a dispute, it will log the Dispute Inquiry and forward the
relevant information to the Merchant by email. Before doing so, GlobalCollect will check
whether the disputed transaction was already refunded by the Merchant and – if so –
report this to the Bank directly. A Merchants‟ response will be logged and forwarded to
the Bank.
Merchants may dispute a reversal of a transaction. Although GlobalCollect will only
mediate the dispute, it will log Dispute Inquiries, forward the Inquiries to the Bank and log
the response. If the dispute results in a financial transaction, this will be reported through
the normal reporting process. Dispute Inquiries may be emailed to
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Dispute Inquiries received from Banks or Merchants before 12:00 CET will be processed,
forwarded and responded to on the same business day. Merchants should consider the
reversal reason when disputing the reversal. It is imperative to provide the information to
the bank which supports the charge and explains the Consumer‟s claim.
9.3 White Mail
From time to time, GlobalCollect may receive correspondence regarding transactions
from its Banks, from Consumers‟ Banks or from Consumers directly. To the extent that it
cannot be reported electronically, this correspondence is forwarded by priority mail on
Wednesdays to the Merchant to a mail address agreed in advance.
Correspondence carrying information that can be reported electronically will be
destroyed after processing.
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10 Prevention of Reversals
Direct Debit reversals can be difficult to prevent as there is no online authorization done
to verify the validity of the account details (for doing a Direct Debit) and the availability
of funds. To prevent the number of transactions that are reversed from surpassing the
acceptable levels, several methods can be employed. This section details the prevention
methods a Merchant can employ to lower their reversal risk.
There are two types of methods; those that have no risk of blocking transactions and
those that do.
10.1 Methods Without Risk of Blocking Transactions
10.1.1 Explanation of the process
Offer clear information on what will happen with the data supplied. In case the data will
be used for more than one transaction, i.e. recurring billing, it is advised to have the
Consumer tick a checkbox that they agree with their account being debited multiple
times. Also list the periodicity that the account will be debited.
10.1.2 Explanation of GlobalCollect‟s role
In most cases the Direct Debit beneficiary is GlobalCollect and not the Merchant. This
might confuse Consumers and make them not recognize the transaction on their bank
statement. To avoid this Merchants should always explain the role that GlobalCollect is
playing in the collection of the funds. This aids in the reduction of the number of
Consumer reversals due to the fact that the consumer does not recognizes the
transaction.
10.1.3 Refund Policy
Make sure you have a disclaimer available for your consumer containing your refund
policy. If possible make sure the consumer accepts this policy during the checkout
process to make sure they have read and understand your process.
10.1.4 Descriptive text on consumer statement
With every Direct Debit Merchants are required to deliver a descriptive text that will be
printed on the bank statement of the Consumer to aid in the recognition of the
transaction. It is recommended that the following information be included as part of the
descriptive text:
URL (if applicable),
Name of the product
Local Customer Service phone number (if possible tool free)
This aids in the reduction of the number of Consumer reversals due to the fact that the
consumer does not recognizes the transaction.
Additionally, the descriptive text that the Consumer will be seeing on their statement can
be displayed on the payment pages/confirmation page or confirmation email at the end
of the checkout process. This way the Consumer is already familiar with the descriptive
text and is less likely to not recognize the transaction on their statement.
10.1.5 Notifications
Send an email to the Consumer informing that their account will be debited right before
the actual debiting of the account takes place. The descriptive text that the Consumer
will see on their bank statement can also be displayed in the notification email. This way
the debiting does not come as a surprise and the Consumer is already familiar with the
descriptive text and is less likely to not recognize the transaction on their statement.
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The sending of notifications is especially useful if there is a large gap between the
transaction date and the debiting of the account.
10.1.6 Bank details validity checks
Avoid bogus account details to be submitted by enabling checking of the proper details
and format for each Direct Debit as specified in the Programmers Guide – WDL
WebCollect Appendix H.
10.1.7 Debit just after salary payment period
To avoid transactions being reversed due to low funds, the actual debiting of the
account is best done after salary payments have been made. It has been proven that if
Merchants know at each country when salaries are paid and then debit the account
during that week, the success rate will increase significantly since it‟s more probable for
Consumers to still have funds in their accounts.
10.2 Methods With Risk of Blocking Some Transactions
10.2.1 Do Bank Validation
By using the DO_BANKVALIDATION or DO_RISKASSESSMENT APIs, Merchants can validate if
the bank account details are correct. These APIs validate the details against country- and
sometimes bank-specific rules. The bank details that are to be validated are different for
each of the supported countries. The country dependent bank details are listed in the
Programmer‟s Guide - WDL WebCollect.
This validation is available for all countries where GlobalCollect processes Direct Debits.
Please note that the validation is done against an extensive set of algorithms, but is not
checked with the clearing systems or banks. This means that it does not protect from
blocked, or closed accounts and low funds.
10.2.2 Block IP addresses outside of the country
If the Merchant have the ability to block IP addresses outside the county this will help in
filtering unwanted foreign transactions (which have low probability of being authentic).
Another option is to check the originating IP address of the Consumer and flag
transactions not coming from the country of the Consumer‟s bank account for further
investigation. The Merchant will then be able to evaluate the flagged transactions and
allow valid transactions to still be processed.
10.2.3 Velocity rules (max transactions per day)
GlobalCollect can limit the number of transactions done with the same account details
within 24 hours. If the maximum is reached any subsequent transactions are denied.
Optionally GlobalCollect can block the processing of transactions that can still be
cancelled with the same account details.
10.2.4 Velocity rules (max reversals over period)
For each transaction GlobalCollect can look at past behavior in terms of number and
type of reversals from the same account details.
GlobalCollect performs the following checks:
The number of reversals made by the same combination of Merchant ID, Account
Number, Bank Code, Branch Code, and Check Digit within the preceding 90
days.
Transactions will be denied if the number of reversals is larger than the allowed
maximum and has a status "customer reversed".
Direct Debit Business Guide - 2.0 July 20, 2010 Page 21 of 43
Transactions that do not pass this screen will be denied. Optionally Merchants
may have GlobalCollect mark these transactions as challenged and still process
these payments after manual intervention.
Transactions will be rejected if the number of reversals is larger than allowed and
the status is "not customer reversed". This usually indicates invalid account
information, closed or blocked account, etc.
10.2.5 GlobalCollect Blacklist
GlobalCollect will check all Direct Debit transactions against its own internal blacklist. If
the account details match an entry in the blacklist, GlobalCollect will deny the
transaction.
Merchants can request the addition of account details to the blacklist that they want
blocked for them.
10.2.6 InterCard Blacklist (Germany only)
Optionally GlobalCollect can check all German Direct Debit transactions against a
blacklist maintained by InterCard AG. This blacklist also includes the local blacklist of
stolen account details KUNO (https://www.kuno-sperrdienst.de/), which is an initiative to
fight crime on non-cash payments through non-police channels.
Direct Debit Business Guide - 2.0 July 20, 2010 Page 22 of 43
11 Country Specific Information
The different Direct Debit schemes can differ from each other in their requirements of
Merchants or Consumer allowances. In this section is described the main differences that
a Merchant should be aware of and take into account when processing Direct Debits in
the different countries.
11.1 Austria (AT)
11.1.1 License Requirements
GlobalCollect is licensed by the Austrian Bank to participate in the Direct Debit process.
This license covers all of GlobalCollect‟s Merchants, making it unnecessary for the
Merchant to obtain their own license.
11.1.2 Local Bank Account Requirements
The Merchant is not required to open their own local bank account. Funds debited from
the Consumer‟s bank account will be credited to a GlobalCollect account.
11.1.3 Administration of Mandates
The Merchant holds the mandates. Banks are entitled to request a copy of the mandates
if needed. The Merchant is responsible for updating its database of mandates. In case
GlobalCollect receives information on amendments or cancellations of the existing
mandates, this information will be forwarded to the Merchant through the “white mail”. A
swift update of the mandate database will reduce the number of refusals and reversals.
11.1.4 Layout of Mandate
There are no standardized forms. The mandate has to contain a number of prescribed
fields, these being:
name and address of the Consumer;
name and address of the Merchant;
reason of debiting;
number of days of reversal period;
account number and Bank sort code (=Bankleitzahl) of the Consumer.
date and place of signature;
signature of the Consumer;
The amount does not have to be printed in case of a continuous Direct Debit. The
mandate should also contain a text to explain to the Consumer how the Direct Debit
process is structured and which rights the Consumer has.
11.1.5 Notification Requirements
Notification to Consumers is not mandatory, but in case of varying amounts or periods it is
advised to notify the Consumer.
11.1.6 Consumer Reversal Periods
The Consumer‟s Bank does not keep any mandates on file and the Bank will allow the
Consumer a period of 56 calendar days after the debit took place to revoke a
transaction.
11.1.7 Collection Schedule
Processing time of the collection file depends on the country of processing and the
collection date (date the Consumer account is to be debited) delivered in the input file.
Direct Debit Business Guide - 2.0 July 20, 2010 Page 23 of 43
If the collection date in the input file has passed, the file will be rejected. GlobalCollect
requires a period of one business day to process the file.
Action Collection Day Cumulative
Merchant submits input file to GlobalCollect -2 1
GlobalCollect submits file to local Bank -1 2
Local Bank processes file on collection date as stated in input file 0 3
Local Bank credits account of GlobalCollect +1 4
Local Bank sends statement to GlobalCollect; payments are matched +2 5
GlobalCollect sends operational report file to the Merchant +3 6
11.2 Belgium(BE)
11.2.1 License Requirements
The Merchant will have to enter into a Direct Debit agreement with the local Bank. The
Merchant will then receive and identification number which is registered at the Belgian
Automated Clearing House (ACH).
11.2.2 Local Bank Account Requirements
A local Bank account is required in Belgium and is opened in the same Bank with which
the Direct Debit agreement is made.
11.2.3 Administration of Mandates
The mandates have to be ordered with the Bank with which the account is opened.
These mandates consist of three copies. Copy 2 is to be kept by the Merchant. Copy 3 is
to be kept by the Consumer. The original will be held by the financial institution (ACH).
Procedure:
The mandate is filled in and signed by the Consumer and the payer (if payer/
accountholder differs from the Consumer). All copies are then sent to and
completed/ signed by the financial institution.
After the Merchant has received copy 2 from the financial institution, the
Merchant can store it in its database. The Merchant has to make sure that the
number on the mandate is the same as the one the Merchant will use.
If the Merchant refuses the mandate the Merchant returns its copy to the financial
institution together with a formal letter.
The Merchant can only use the Direct Debit instruction of the Consumer when the
Merchant received the signed copy 2 of the mandate from the financial
institution. Before this the Consumer cannot be charged with a Direct Debit
transaction.
11.2.4 Layout of Mandate
The Bank has standardized mandates for Direct Debits it can provide to be used.
11.2.5 Notification Requirements
If the Direct Debit mandate relates to transactions with variable amounts or with a
variable frequency, a pre-notification is required. If the mandate relates to recurring
payments with the same amount and frequency, sending a notification once a year is
sufficient. The Merchant has to send the notification of the Direct Debit to the Consumer
at least 5 days before the transaction will take place, stating the date the amount will be
collected.
11.2.6 Consumer Reversal Periods
The Consumer has a period of 56 calendar days after the debit took place to revoke a
transaction.
Direct Debit Business Guide - 2.0 July 20, 2010 Page 24 of 43
11.2.7 Collection Schedule
Processing time of the collection file depends on the country of processing and the
collection date (date the Consumer account is to be debited) delivered in the input file.
If the collection date in the input file has passed, the file will be rejected. GlobalCollect
requires a period of one business day to process the file.
Action Collection Day Cumulative
Merchant submits input file to GlobalCollect -2 1
GlobalCollect submits file to local Bank -1 2
Local Bank processes file on collection date as stated in input file 0 3
Local Bank credits account of GlobalCollect +5 8
Local Bank sends statement to GlobalCollect; payments are matched +6 9
GlobalCollect sends operational report file to the Merchant +7 10
11.3 Switzerland (CH)
11.3.1 License Requirements
The Merchant will have to be licensed by the Swiss Banking system. Together with
GlobalCollect the Merchant can obtain this license and will be given a Direct Debit
identification name.
11.3.2 Local Bank Account Requirements
A local bank account is required in Switzerland.
11.3.3 Administration of Mandates
The mandates have to be ordered with the Bank. Two types of Direct Debit mandates are
used: mandates without reversal option and mandates with reversal option. Merchants of
GlobalCollect will use the mandates with reversal option.
The mandates consist of three copies. Copy 2 is to be kept by the Consumer. The
Merchant will hold copy 1 and the Bank of the Consumer will hold the original.
There are two methods that can happen for submitting mandates.
First method:
the mandate is signed by the Consumer, the original and copy 1 are sent to the
Merchant;
the Merchant forwards the mandates (original and copy 1) to its Bank;
the Bank forwards the mandates to the Bank of the Consumer. The mandates are
lodged by the Banks in their systems and the remaining information (clearing
number of Consumer‟s Bank; correct account number and name and address of
Consumer) are added to the mandates;
the original is kept by the Banks and the Merchant will receive copy 1.
Second Method:
the mandate is signed by the Consumer, the original and copy 1 are sent to the
Bank of the Consumer;
the Bank lodges the mandate and adds the additional information;
the Bank forwards copy 1 to the Merchant with the correct information (see
above).
11.3.4 Layout of Mandate
Banks have standardized mandates for Direct Debits. The mandate does not have an
amount printed on it. The mandate is A4 size and the upper half can be used by the
Merchant to print a text to inform its Consumer. On the forms the identification of the
Merchant is pre-printed as is its address. The address of the Merchant should also be pre-
Direct Debit Business Guide - 2.0 July 20, 2010 Page 25 of 43
printed. If this information is not available, the Consumer has to be informed to fill in its
address. In a separate line the Consumer is instructed to send the mandate (original and
copy 1) to the Bank or to the Merchant. The mandate informs the Consumer of its right to
reverse the payment within 56 days.
11.3.5 Notification Requirements
Notification is not mandatory. In case of varying amounts or periods it is advised to notify
the Consumer as this will reduce the number of reversals.
11.3.6 Consumer Reversal Periods
The Consumer can revoke the debit to his account within 30 calendar days after the debit
has taken place. The Consumer has to sign and return the debit advice to his Bank.
11.3.7 Collection Schedule
Processing time of the collection file depends on the country of processing and the
collection date (date the Consumer account is to be debited) delivered in the input file.
If the collection date in the input file has passed, the file will be rejected. GlobalCollect
requires a period of one business day to process the file.
Action Collection Day Cumulative
Merchant submits input file to GlobalCollect -4 1
GlobalCollect submits file to local Bank -3 2
Local Bank processes file on collection date as stated in input file 0 5
Local Bank credits account of GlobalCollect 0 5
Local Bank sends statement to GlobalCollect; payments are matched +1 6
GlobalCollect sends operational report file to the Merchant +2 7
11.4 Germany (DE)
11.4.1 License Requirements
GlobalCollect is licensed by the German Bank to participate in the Direct Debit process.
GlobalCollect has obtained this license for its Merchants.
11.4.2 Local Bank Account Requirements
The Merchant is not required to open their own local bank account. Funds debited from
the Consumer‟s bank account will be credited to a GlobalCollect account.
11.4.3 Administration of Mandates
The Merchant holds the mandates. Banks are entitled to request a copy of the mandates
if needed. The Merchant is responsible for updating its database of mandates. In case
GlobalCollect receives information on amendments or cancellations of the existing
mandates, this information will be forwarded to the Merchant through the “white mail”. A
swift update of the mandate database will reduce the number of refusals and reversals.
11.4.4 Layout of Mandate
There are no standardized forms. The mandate has to contain a number of prescribed
fields, these being:
name and address of the Consumer;
name and address of the Merchant;
reason of debiting;
number of days of reversal period;
account number and Bank sort code (=Bankleitzahl) of the Consumer.
date and place of signature;
signature of the Consumer;
Direct Debit Business Guide - 2.0 July 20, 2010 Page 26 of 43
The amount does not have to be printed in case of a continuous Direct Debit. The
mandate should also contain a text to explain to the Consumer how the Direct Debit
process is structured and which rights the Consumer has.
11.4.5 Notification Requirements
Notification is not mandatory. In case of varying amounts or periods it is advised to notify
the Consumer as this will reduce the number of reversals.
11.4.6 Consumer Reversal Periods
In Germany, Banks send their clients not only a weekly or monthly Bank statement, but
they also send a “final statement”. This “final statement” is typically sent once a quarter, a
very small subset of Banks sends it once a year. The purpose of this final statement is to
end all opportunities for Consumers to object to withdrawals from their account.
Objections to specific withdrawals can be raised until 6 weeks (42 calendar days) after
the debit appeared on the final statement.
11.4.7 Collection Schedule
Processing time of the collection file depends on the country of processing and the
collection date (date the Consumer account is to be debited) delivered in the input file.
If the collection date in the input file has passed, the file will be rejected. GlobalCollect
requires a period of one business day to process the file.
Action Collection Day Cumulative
Merchant submits input file to GlobalCollect -2 1
GlobalCollect submits file to local Bank -1 2
Local Bank processes file on collection date as stated in input file 0 3
Local Bank credits account of GlobalCollect +1 4
Local Bank sends statement to GlobalCollect; payments are matched +2 5
GlobalCollect sends operational report file to the Merchant +3 6
11.5 Spain (ES)
11.5.1 License Requirements
GlobalCollect is licensed by the Spanish Bank to participate in the Direct Debit process.
GlobalCollect has obtained this license for its Merchants.
11.5.2 Local Bank Account Requirements
The Merchant is not required to open their own local bank account. Funds debited from
the Consumer‟s bank account will be credited to a GlobalCollect account.
11.5.3 Administration of Mandates
The Merchant holds the mandates. Banks are entitled to request a copy of the mandates
if needed. The Merchant is responsible for updating its database of mandates. In case
GlobalCollect receives information on amendments or cancellations of the existing
mandates, this information will be forwarded to the Merchant through the “white mail”. A
swift update of the mandate database will reduce the number of refusals and reversals.
11.5.4 Layout of Mandate
There are no standardized forms. However, the mandate has to contain a number of
prescribed fields:
name and address of the Consumer;
name and address of the Merchant;
reason of debiting;
account number of the Consumer.
date and place of signature;
Direct Debit Business Guide - 2.0 July 20, 2010 Page 27 of 43
signature of the Consumer;
11.5.5 Notification Requirements
Notification is not mandatory. In case of varying amounts or periods it is advised to notify
the Consumer as this will reduce the number of reversals.
11.5.6 Consumer Reversal Periods
The Consumer‟s Bank does not keep any mandates on file and the Bank will allow the
Consumer a period of 56 calendar days after the debit took place to revoke a
transaction for which a mandate was given. For transactions where no mandate was
given, the Consumer has 13 months after the debit took place to revoke it.
11.5.7 Collection Schedule
Processing time of the collection file depends on the country of processing and the
collection date (date the Consumer account is to be debited) delivered in the input file.
If the collection date in the input file has passed, the file will be rejected. GlobalCollect
requires a period of one business day to process the file.
Action Collection Day Cumulative
Merchant submits input file to GlobalCollect -3 1
GlobalCollect submits file to local Bank -1 3
Local Bank processes file on collection date as stated in input file 0 4
Local Bank credits account of GlobalCollect +1 5
Local Bank sends statement to GlobalCollect; payments are matched +2 6
GlobalCollect sends operational report file to the Merchant +3 7
11.6 France (FR)
11.6.1 License Requirements
The Merchant has to obtain its own national Direct Debit issuer number ("Numéro National
d'Emetteur - NNE") from the Banque de France via a financial institution subject to French
Banking law and submit the Direct Debit instructions through a Bank registered with a
French Automated Clearing House.
11.6.2 Local Bank Account Requirements
A local bank account is required in France.
11.6.3 Administration of Mandates
The Direct Debit request (Demandé de Prélèvement) is retained by the Merchant. The
Direct Debit authorization (Authorisation de Prélèvement) should be sent to the
Consumer's Bank, which retains it.
Should GlobalCollect receive information regarding the change or cancellation of a
mandate, this information will be forwarded to the Merchant. The Merchant should then
take the appropriate action.
The mandates have to be ordered with the Bank the Merchant has the local bank. These
mandates can be divided into two parts.
a "Demande de Prélèvement" (Direct Debit request) to allow the Merchant to
issue Direct Debit instructions. This part is retained by the Merchant.
an "Authorisation de Prélèvements" (Direct Debit authorization) to authorize the
Consumer's Bank to debit all Direct Debit instructions issued by the Merchant
without time limits or predetermined amounts. The Merchant must send this part to
the Consumer's Bank, which retains it.
Direct Debit Business Guide - 2.0 July 20, 2010 Page 28 of 43
Together with this signed mandate, the Consumer sends to the Merchant a "Relevé
d'Identité Bancaire (RIB)". This is a French identification document for the Consumer's
account and enables the Merchant to ascertain the domiciliary address of the
Consumer's Bank.
11.6.4 Layout of Mandate
Banks have standardized mandates for Direct Debits. The layout of the mandates has to
be conform the examples given by the Banks. The "Numéro National d'Emetteur" must be
stated on the mandate. (printed or written).
11.6.5 Notification Requirements
Notification is not mandatory. In case of varying amounts or periods it is advised to notify
the Consumer as this will reduce the number of reversals.
11.6.6 Consumer Reversal Periods
The Consumer has a period of 56 calendar days after the debit took place to revoke a
transaction for which a mandate was given. For transactions where no mandate was
given, the Consumer has 13 months after the debit took place to revoke it.
11.6.7 Collection Schedule
Processing time of the collection file depends on the country of processing and the
collection date delivered in the input file. If the collection date in the input file has
passed, the file will be rejected. GlobalCollect requires a period of one business day to
process the file.
The Direct Debit instruction is sent to the Merchant's Bank (GlobalCollect requires a period
of one business day to process the file, before transmitting it to the Bank). The Merchant‟s
Bank issues the instructions and the Consumer's Bank processes these after checking the
Consumer's mandate.
Exchange and settlement between the Merchant's Bank and the Consumer's Bank are
executed via the "SIT" (Système Interbancaire de Télécompensation), the domestic
automated clearing and settlement system, and through both Bank's accounts at the
Banque de France. All Direct Debits are settled on the collection date, provided that
each Direct Debit instruction is issued by the Merchant's Bank five Banking days before its
collection date.
Action Collection Day Cumulative
Merchant submits input file to GlobalCollect -6 1
GlobalCollect submits file to local Bank -5 2
Local Bank processes file on collection date as stated in input file 0 7
Local Bank credits account of GlobalCollect 0 7
Local Bank sends statement to GlobalCollect; payments are matched +1 8
GlobalCollect sends operational report file to the Merchant +2 9
11.7 Great Britain (GB)
11.7.1 License Requirements
The Merchant has to be licensed by „the Direct Debit scheme‟ in order to collect by
Direct Debit in the UK. The license is given by the Banks or building societies and can be
obtained with or without the help of GlobalCollect. In case of the latter, the Merchant
has to indemnify the Bank for any loses or claims related to the Direct Debit process. The
Bank will also require proof of the Merchant of financial soundness. GlobalCollect can
indemnify the Bank on behalf of the Merchant. This gives small companies or companies
that are not yet active on the UK market the possibility to collect payments through Direct
Debit.
Direct Debit Business Guide - 2.0 July 20, 2010 Page 29 of 43
11.7.2 Local Bank Account Requirements
The Merchant is given a separate account and an “Originator Identification Number”
(OIN). If the Merchant has the license in its own name, the account will bear its name as
well. GlobalCollect will have to be given the authority to operate the account in name of
the Merchant. All statements and reports will be sent to GlobalCollect and solely
GlobalCollect will operate the account. If GlobalCollect indemnifies the Bank on behalf
of the Merchant, the account will be named: “Global Collect BV re <Merchant name>”.
(Global Collect BV is the legal name of GlobalCollect). This name will be shown on the
account statement of the Consumer.
11.7.3 Administration of Mandates
The Merchant registers the mandates in its database. The original mandates are sent to
the Banks and building societies of the Consumers. GlobalCollect does not register the
mandates.
The Merchant is also required to register the „status‟ of the Direct Debit, i.e.: the first Direct
Debit, the n-th Direct Debit, representation or final Direct Debit. In the file sent to
GlobalCollect and forwarded to BACS this status is communicated.
Procedure:
The mandate, with the license number or Originator Identification Number printed
on it, is sent to the Consumers.
The mandate has to be filled in by the Consumer (the account number of the
Consumer) and signed.
The mandate is returned to the Merchant directly or through GlobalCollect.
The Merchant updates its database with the new Direct Debit Consumer.
The original mandate is forwarded to the Bank or building society of the
Consumer.
The Banks use the mandate to verify whether a Direct Debit has been authorized
by the account holder (the Consumer of the Merchant).
It should be noted that besides the traditional way of lodging the mandate (by sending
the paper form to the paying banks), a merchant may want to use the AUDDIS service.
The AUDDIS service is explained in detail in Appendix A.
11.7.4 Layout of Mandate
The mandates have to be printed with the OIN. This number is given as soon as the Bank
or building society of the Merchant or GlobalCollect approves the mandate. The
mandates can be printed in several sizes. The layout of these mandates has to be
conform the examples given by the Banks. If the layout of the mandate is changed
without prior approval of the Bank, the Banks or building societies of the debtors may
refuse the Direct Debit. To prevent fraud, the Banks and building societies are very strict in
adhering to the rules.
The reference number on the mandate has to be the same number that is submitted in
the electronic file to GlobalCollect (authorization number). This number serves as a check
to verify the correctness of the Direct Debit. Should GlobalCollect receive information
regarding the change or cancellation of a mandate, this information will be forwarded to
the Merchant. The Merchant should then take the appropriate action.
Additionally:
A mandate must always be written in English; bilingual instructions are permitted.
A mandate cannot contain a fixed amount or date.
The mandate wording cannot be varied or added to by the Merchant except in
the originator‟s official use box.
Direct Debit Business Guide - 2.0 July 20, 2010 Page 30 of 43
It is not allowed to use a mandate which has payment details written on adhesive
labels or where any means of correction on the mandate has been made.
11.7.5 Notification Requirements
The Consumer should be notified of a Direct Debit no less than 10 days prior to the Direct
Debit. This notification can be „eliminated‟ by notifying the Consumer before the first
debit of the periodicity of the Direct Debit. If the amount of the Direct Debit changes, the
Consumer has to be notified.
11.7.6 Consumer Reversal Periods
Should debits have taken place without a signed mandate being in place, the Consumer
has the right to reverse all previous payments without any time limitations. Otherwise the
Consumer has 5 calendar days to reverse the debit.
11.7.7 Indemnity claims
Paying Banks (Bank of the Consumer who was debited) will refund the Payer (Consumer)
in case of an error by the Originator (Merchant). The Consumer for example can go to his
/ her Bank and tell that the amount was debited from the account by mistake, without
instruction, on the wrong date, etc, etc.
Under the terms of the Direct Debit Guarantee, the Paying Banks will accept the word of
the Payer concerning an error made by an Originator and will make an immediate
refund of the amount collected. The Paying Bank uses the Indemnity Claim process to
recover the refunded payment from the Originator. This involves sending a completed
Indemnity Claim form (example available at GlobalCollect) detailing the reason for the
claim and the amount claimed.
Under the Terms of their Direct Debit Scheme membership, the Originator must settle the
claim within 14 working days, even if liability for the error is disputed.
A valid Indemnity Claim must meet one of the following criteria:
1. The amount and / or date of the Direct Debit differs from the Advance Notice
issued to the Payer by the Originator
2. No Advance Notice was received by the Payer or the amount quoted is disputed
by the Payer
3. Direct Debit Instruction (DDI) cancellation by the Paying Bank
4. Where the Payer has cancelled the DDI direct with the Originator, notwithstanding
the fact that the Payer may not have cancelled the DDI with the Bank
5. No Instruction held. Payer disputes having given authority
6. Signature on DDI is fraudulent
7. Originator name disputed. This is where the Paying Bank is unable to identify and
consequently action a Payer‟s request to cancel a DDI as a result of the Originator
using one of the set-up exceptions in respect of trading names or facilities
management
NB: Where an Originator has made an error which does not fall within the valid Indemnity
Claim criteria, this will be referred to the Direct Debit Scheme Steering Group, which will
determine liability and give its authority for an Indemnity Claim to be raised.
If the Originator disagrees as to the validity of the Indemnity Claim he has the right to
make a Counter Claim under certain conditions. The Indemnity Claim should be settled
anyway.
Direct Debit Business Guide - 2.0 July 20, 2010 Page 31 of 43
Procedure followed by GlobalCollect:
The Indemnity Claim will be sent to the Originator. In this case this will be
GlobalCollect. Because GlobalCollect (and not the Merchant) owns the Bank
accounts involved, the Claims should be sent directly to the Bank of
GlobalCollect.
The Bank of GlobalCollect will take care that the amount will be debited from the
account involved.
GlobalCollect will then report the debited item to the Merchant and will charge
the Merchant accordingly.
11.7.8 Collection Schedule
Processing time of the collection file depends on the country of processing and the
collection date delivered in the input file. If the collection date in the input file has
passed, the file will be rejected. GlobalCollect requires a period of one business day to
process the file.
After the Banks and building societies have received the mandates a period of 14 days is
used to lodge the mandates. This means that only 14 days after the reception of the
mandates by the Banks the first Direct Debit can by processed.
Collection schedule for a first time transaction: Action Collection Day Cumulative
Mandate sent to Banks and building societies -15 1
Merchant submits input file to GlobalCollect -2 14
GlobalCollect submits file to local Bank -1 15
Local Bank processes file on collection date as stated in input file 0 16
Local Bank credits account of GlobalCollect 3 19
Local Bank sends statement to GlobalCollect; payments are matched +4 20
GlobalCollect sends operational report file to the Merchant +5 21
Collection schedule for a subsequent transactions: Action Collection Day Cumulative
Merchant submits input file to GlobalCollect -2 1
GlobalCollect submits file to local Bank -1 2
Local Bank processes file on collection date as stated in input file 0 3
Local Bank credits account of GlobalCollect 3 6
Local Bank sends statement to GlobalCollect; payments are matched +4 7
GlobalCollect sends operational report file to the Merchant +5 8
11.8 Italy (IT)
11.8.1 License Requirements
The Merchant will have to be licensed by the Italian Banking system. Together with
GlobalCollect the Merchant can obtain this license and will be given a Direct Debit
identification name.
11.8.2 Local Bank Account Requirements
A local bank account is required in Italy.
11.8.3 Administration of Mandates
The mandates have to be ordered with the Bank with which the local bank account is
opened. The mandate consist of four copies. A copy is held by the Bank of the
Consumer, the Merchant, the Consumer and the Automated Clearing House.
Procedure:
The mandate is first filled by the Consumer, then forwarded to its Bank.
Direct Debit Business Guide - 2.0 July 20, 2010 Page 32 of 43
Within the Banking system, the mandate is lodged with the Consumer‟s Bank, the
ACH and the Bank of the Merchant.
The Consumer‟s Bank will print a Consumer reference on the mandate and
forward it to the Merchant‟s Bank
The Merchant receives its copy of the mandate from its Bank.
Each time the Merchant requests a Direct Debit of the account of the Consumer,
the Consumer reference given by the Consumer‟s Bank has to be included in the
request
Should GlobalCollect receive information regarding the change or cancellation of a
mandate, this information will be forwarded to the Merchant. The Merchant should then
take the appropriate action.
11.8.4 Layout of Mandate
Banks have standardized mandates for Direct Debits. The mandate does not have an
amount printed on it and is in A4 size.
11.8.5 Notification Requirements
Notification is not mandatory, but in case of varying amounts or periods it is advised to
notify the Consumer. This will reduce the number of reversals.
11.8.6 Consumer Reversal Periods
The Consumer has a period of 56 calendar days after the debit took place to revoke a
transaction for which a mandate was given. For transactions where no mandate was
given, the Consumer has 13 months after the debit took place to revoke it.
11.8.7 Collection Schedule
Processing time of the collection file depends on the country of processing and the
collection date (date the Consumer account is to be debited) delivered in the input file.
If the collection date in the input file has passed, the file will be rejected. GlobalCollect
requires a period of one business day to process the file.
Action Collection Day Cumulative
Merchant submits input file to GlobalCollect -13 1
GlobalCollect submits file to local Bank -12 2
Local Bank processes file on collection date as stated in input file 0 14
Local Bank credits account of GlobalCollect +3 17
Local Bank sends statement to GlobalCollect; payments are matched +4 18
GlobalCollect sends operational report file to the Merchant +5 19
11.9 The Netherlands (NL)
11.9.1 License Requirements
GlobalCollect is licensed by the Dutch Bank to participate in the Direct Debit process.
GlobalCollect has obtained this license for its Merchants.
11.9.2 Local Bank Account Requirements
The Merchant is not required to open their own local bank account. Funds debited from
the Consumer‟s bank account will be credited to a GlobalCollect account.
11.9.3 Administration of Mandates
The Merchant holds the mandates. Banks are entitled to require a copy of the mandates
if needed. Mandates may be kept on file using microfilm. Mandates have to be kept on
archive for at least five years after the expiry date or the last date on which the account
was debited. Should GlobalCollect receive information regarding the change or
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cancellation of a mandate, this information will be forwarded to the Merchant. The
Merchant should then take the appropriate action.
11.9.4 Layout of Mandate
Banks have standardized mandates for continuous Direct Debits. For one-off and time
limited Direct Debits are no standardized forms.
The mandate has to contain a number of prescribed fields:
name and address of Consumer;
name and address of the Merchant;
reason of debiting;
number of days of reversal period;
account number of the Consumer;
date and place of signature;
signature of Consumer;
Furthermore, the Merchant has to inform the Consumer:
he/she has agreed to the Merchant by signing the mandate his/her account will
be Direct Debited for the amounts mentioned;
the mandate is valid until cancelled (in case of continuous Direct Debit);
to cancel the Direct Debit, the Consumer has to turn to the Merchant;
to reverse a Direct Debit, the Consumer has to turn to his/her Bank;
the moment of debiting and the period of time in which the debiting will occur.
11.9.5 Notification Requirements
Notification is not mandatory, but in case of varying amounts or periods it is advised to
notify the Consumer. This will reduce the number of reversals.
11.9.6 Consumer Reversal Periods
The following time frames apply for the revocation of a Direct Debit:
Recurring debits: 56 calendar days
Recurring B2B: 5 working days
Recurring gambling: No reversal possible
One-off debits: No reversal possible
11.9.7 Collection Schedule
Processing time of the collection file depends on the country of processing and the
collection date (date the Consumer account is to be debited) delivered in the input file.
If the collection date in the input file has passed, the file will be rejected. GlobalCollect
requires a period of one business day to process the file.
Action Collection Day Cumulative
Merchant submits input file to GlobalCollect -2 1
GlobalCollect submits file to local Bank -1 2
Local Bank processes file on collection date as stated in input file 0 3
Local Bank credits account of GlobalCollect 0 3
Local Bank sends statement to GlobalCollect; payments are matched +1 4
GlobalCollect sends operational report file to the Merchant +2 5
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12 Appendix A: Sample Mandates
12.1 Austria (AT)
Ermächtigung zum Einzug von Forderungen im Einzugsermächtigungsverfahren Hiermit ermächtige(n) ich/wir Sie, die von mir/uns zu entrichtenden Zahlungen bei Fälligkeit zu Lasten meines/unseres Kontos mittels Einzugsermächtigung einzuziehen. Damit ist auch meine/unsere kontoführende Bank ermächtigt, die Einzüge einzulösen, wobei für diese keine Verpflichtung zur Einlösung besteht, insbesondere dann, wenn mein/unser Konto die erforderliche Deckung nicht aufweist. Ich/Wir habe(n) das Recht, innerhalb von 42 Kalendertagen ab Abbuchungstag ohne Angabe von Gründen die Rückbuchung bei meiner/unserer Bank zu veranlassen. Arthur van der Putten ______________________________________________________________ Name und genaue Anschrift des Zahlungspflichtigen 55500643635 ______________________________________________________________ Konto-Nr. Zahlungspflichtigen Raiffeisen Zentral Bank Osterreich AG ______________________________________________________________ bei (genaue Bezeichnung der Kreditunternehmung) 31000 ______________________________________________________________ Bankleitzahl Abonnement Business Week ______________________________________________________________ Zahlungen wegen (Verpflichtungsgrund, ev. Betragsbegrenzung – gilt nicht gegenüber der durchführenden Banken) EUR 150,00 ______________________________________________________________ Betrag Vienna , 7 Mai 2001 ______________________________________________________________ Ort, Datum Unterschrift An (Zahlungsempfänger) GlobalCollect Attn.: Business Development P.O. Box 2001
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12.2 Belgium (BE)
AVIS DE DOMICILIATION BERICHT VAN DOMICILIERING Le soussigné / Ondergetekende (au nom de qui les factures sont établies / op wiens naam de facturen worden opgesteld)
Nom / Naam: Ron Vollebregt Rue / Straat, No. / Nr: Rue de Example 1 Code postal, localité / B-1000 Bruxelles Postnr, localiteit:
Prie la firme/ Verzoekt de firma (qui établit les factures / die de facturen opstelt)
Nom / Naam: GlobalCollect Rue / Straat, No. / Nr: Polarisavenue 17 Code postal, localité / 2130 GE Hoofddorp Postnr, localiteit: Pays-Bas
D’encaisser à partir de ce jour et jusqu’à révocation expresse toutes factures / Om vanaf heden en tot uitdrukkelijke herroeping, al de facturen
Référence ou No d’abonné / referte of abonneenummer ABO2001Telegroup
Auprés de l’institution financière / te incasseren bij de financiële instelling
Nom / Naam: GlobalCollect Rue / Straat, No. / Nr: Polarisavenue 17 Code postal, localité / 2130 GE Hoofddorp Postnr, localiteit: Pays-Bas
Par le débit du compte No. /
door het debet van rekening nr. 2 1 0 --- 0 0 7 9 5 3 0 --- 4 2
Le titulaire du compte/ op naam – van de ondergetekende
Nom / Naam: Ron Vollebregt Rue / Straat, No. / Nr: Rue de Example 1 Code postal, localité / B-1000 Bruxelles Postnr, localiteit
Localité / plaats: Bruxelles Pour accord, le titulaire du compte/ Voor akoord, de rekeninghouder (*),
Date/ Datum: 7 mei 2001 Signature/Handtekening:
RESERVE A LA BANQUE / VOORBEHOUDEN VOOR DE DOMICILIE-INSTELLING
La domiciliation mentionné ci-dessous a été acceptée sous le numéro: De hierboven vermelde domiciliëring werd aanvaard onder nummer:
Date / Datum: Cachet et signature Stempel en handtekening
NUMERO DE DOMICILIATION DOMICILIERINGSNUMMER
- -
Numéro d’identification du créancier
Identificatienummer van schuldeiser
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12.3 Switzerland (CH)
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12.4 Germany (DE)
Ermächtigung zum Einzug von Forderungen mittels Lastschriften
Hiermit ermächtige(n) ich/wir, die von mir/uns zu entrichtenden Zahlungen bei Fälligkeit zu Lasten meines/unseres Kontos mittels Lastschrift einzuziehen. Wenn mein/unser Konto die erforderliche Deckung nicht aufweist, besteht seitens des kontoführenden Kreditinstituts keine Verpflichtung zur Einlösung. Teileinlösungen werden im Lastschriftverfahren nicht vorgenommen.
Name und genaue Anschrift des Zahlungspflichtigen
Ronald van Keulen___________________________________
Musterstrasse1______________________________________
D-5200 Muster______________________________________ Konto-Nr des Zahlungspflichtigen 7017361___________________________________________ Name der Bank Westdeutsche_LandesBank____________________________ Bankleitzahl 37050000______ ____________________________________
Gesamtbetrag EUR 100,00________________________________________ An (Zahlungsempfänger)
GlobalCollect
_____________________________________________
attn.: Business Development
_____________________________________________
P.O. Box 2001
_____________________________________________
2130 GE Hoofddorp
Ort, Datum : Koeln, 7 Mai 2004 Unterschrift:
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12.5 Spain (ES)
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12.6 France (FR)
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12.7 Great Britain (GB)
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12.8 Italy (IT)
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12.9 The Netherlands (NL)
Eenmalige Machtiging Ondergetekende verleent hierbij machtiging aan GlobalCollect om van zijn/haar ondergenoemde (giro-) rekening éénmalig een bedrag af te schrijven:
Bedrag : EUR 100,00 ---------------------------------- Bankrekeningnummer : 440339464 --------------------- Girorekening : -------------------------
Naam en voorletters : Enri Meijers --------------------------------------------------------------------
Adres : Voorbeeldstraat 1 ------------------------------------------------------------
Postcode en plaats : 2000 BV Voorbeeldstad --------------------------------------------------- Datum : 7 mei 2004 -------------------- Handtekening : -------------------------- Na ondertekening dit formulier sturen naar: GlobalCollect t.a.v.: Business Development Postbus 2001 2130 GE Hoofddorp Nederland
Direct Debit Business Guide - 2.0 July 20, 2010 Page 43 of 43
13 Appendix C: Refusals and Reversal Reasons
The codes in the following table are used both as refusal reason and as reversal reason.
But there is a significant difference between these two types of rejections:
A refusal occurs on a Direct Debit payment when it is sent to the bank or clearing
house and is immediately refused. The payment amount will not be credited to
the GlobalCollect bank account and therefore will not be remitted to the
Merchant.
A reversal occurs on a Direct Debit payment when it is rejected by the (debtor's)
bank or by the customer/debtor after the payment has been credited to the
GlobalCollect bank account and therefore will be remitted to the Merchant.
When the reversal is received the GlobalCollect bank account will be debited.
GlobalCollect will then settle this amount.
13.1 Customer reversed
ID Type Description Additional information on refusal/reversal reasons
08 DD Direct debit disputed Direct Debit payment reversed on request of account holder.
65 DD Refund on request of customer Direct Debit has been refunded on the initiative of consumer.
13.2 Not Customer Reversed
ID Type Description Additional information on refusal/reversal reasons
01 DD Invalid account-identification Account id is not formatted according to country specific format requirements OR account does not exist (anymore).
02 DD Invalid debit bank identification Bank id or branch id (of debit-bank) is not formatted according to country specific format requirements OR bank (branch) does not exist (anymore) OR bank (branch) cannot process Direct Debit.
03 DD Invalid account type Debit account exists but is not suited for Direct Debit. Debtor has to issue a new authorization on a suitable account.
04 DD Blocked or closed account Debit account is (temporarily) blocked for Direct Debit.
05 DD Authorization missing No valid authorization present at debit bank.
06 DD Authorization cancelled Authorization withdrawn
07 DD Insufficient funds Direct Debit payment not processed because of insufficient funds. (Special cases)
09 DD Refused by bank Direct Debit payment rejected by bank (without further specification). (Can be retried)
10 DD Name/number do not match The account number and name accountholder do not match (combination checked by some banks).