SEPA Direct Debit (SDD)

SEPA Direct Debits (SDD)

SEPA Direct Debits (SDD) a part of the overall Single Euro Payments Area (SEPA) initiative, is the payment instrument and scheme that by 2010 will have totally replaced currently existing domestic direct debiting schemes. SDD is a major challenge for the European banking community, as disparities in direct debit processing across the continent are wide. They concern areas such as message formats, data such as bank account number standards (BIC & IBAN), the flow of mandates, verifying mandate procedure, timeline and chronology of collections and timeframes for returns and refunds. Clearly, the implementation of SDD is not just “a formatting issue”. The new scheme differs from domestic schemes by its very business rules. There can therefore be no quick-fix solution consisting of mapping the SDD format into a domestic format for processing within the banks’ legacy direct debit applications. For banks aiming to be ready by 2008, investment in new IT systems is inevitable.

Clear2Pay’s SEPA Direct Debits solution is targeted to fulfil banks’ requirements in terms of direct debit processing. These requirements include acquisition from customer channels, ”On-us / off-us” routing & processing of “on us” transactions, mandates verification, validation of incoming direct debits against list of stop payments, exception management (unpaid items in particular), interfacing with PE-ACHs (e.g. STEP2), customer reporting, generation of accounting entries based on configurable accounting rules, verification of compliance with direct debit scheme timeline rules and Representation of other banks within the central clearing infrastructure (e.g. STEP2).

Clear2Pay’s SDD solution is based on the Open Payment Framework (OPF). The OPF from Clear2Pay is a library of component building blocks from which payments solutions can be derived. The OPF is built entirely on a Service Oriented Architecture (SOA) delivering common, reusable services consisting of a comprehensive data model, choreographed payment business processes and configurable services including parsing, validation, cost-based routing, warehousing, security, auditing and many more.