Paymentmethod - Direct Debit

Facts

Category	Information
Payment method	SEPA Direct Debit
Market	SEPA countries
Currency	Euro (EUR)
Available from	Professional (S) package
Payment	Not guaranteed; rejection, reversal and an unauthorised direct debit claim (MOI) are possible
Payout	Via Pay.
External direct debit agreement	Not required
Payment option ID	137
Webshop plugins	One-off direct debits via the payment screen only; recurring and flexible direct debits via the Pay. Admin Panel, batch import or API

SEPA Direct Debit allows you to collect payments directly from your customers’ bank accounts with their authorisation. You can use direct debit for a one-off payment, a fixed recurring amount or flexible follow-up payments. This makes the payment method suitable for subscriptions, memberships, membership fees and invoices, among other use cases.

A direct debit payment is not guaranteed. The bank may reject an instruction, and under certain conditions the account holder may reverse the debit. You should therefore always obtain a valid mandate and send a clear advance notice.

Contents

1. Which type of direct debit should you choose?
2. What do you need?
3. Activating Direct Debit
4. Configuring Direct Debit for a sales location
5. Arranging a mandate and advance notice
6. Submitting a direct debit
7. Processing time and payout
8. Submitting direct debits via the API
9. Checking statuses and handling reversals
10. Limits and important considerations

Which type of direct debit should you choose?

Pay. supports three types of direct debit mandate. Choose the option that best suits your payment arrangement with the customer.

Direct debit type	When to use it	How it works
One-off	For a single debit	One direct debit is submitted after the mandate has been created. The mandate cannot be reused afterwards.
Recurring	For a fixed amount at a fixed interval, such as every month or quarter	Pay. automatically creates subsequent direct debits at the selected interval.
Flexible	When the amounts or collection dates may vary	Once the first direct debit has been processed successfully, you submit each subsequent direct debit separately via the API.

A recurring direct debit is best suited to subscriptions with a fixed amount. Choose a flexible direct debit if the amount, description or collection date may differ for each payment.

What do you need?

Before you can activate Direct Debit, you will need:

• at least the Professional (S) package;
• an active sales location in the Pay. Dashboard;
• a publicly accessible page containing your terms and conditions;
• a valid direct debit mandate from the customer;
• contact details to display on the customer’s bank statement;
• the customer’s bank account details, including at least the account holder’s name and IBAN.

You do not need to enter into a separate direct debit agreement with a bank or another external party. Pay. processes the direct debit instructions and pays out the funds received through your regular clearing cycle.

Activating Direct Debit

Direct Debit is not enabled by default. You must first activate it in your contract:

1. Log in to the Pay. Dashboard.
2. Go to Merchant > Company details.
3. Under Contract, select Change contract & features.
     
4. Enable Direct Debit and confirm your application.

Our onboarding team will review your application before activating the payment method. You will receive an email once the onboarding process has been completed.

Configuring Direct Debit for a sales location

Once approved, you can add Direct Debit to the sales location where you want to use the payment method:

1. In the Pay. Dashboard, go to the relevant sales location and click Edit.
2. Go to Payment methods.
3. Under Other payment options, find Direct Debit (SEPA Direct Debit) and enable it.
4. Click Add next to the payment method to create a configuration.
5. Complete the settings below and save the configuration.

Setting	Explanation
Name	A recognisable name for the configuration. You can use the same configuration for multiple sales locations.
Terms and conditions URL	The direct URL of the page where customers can view your terms and conditions.
Payment bank info	Up to 30 characters that will appear on the customer’s bank statement, such as your URL, email address or telephone number.

Arranging a mandate and advance notice

You may only collect a direct debit if the customer has authorised you to do so. Record the mandate and retain the evidence for as long as you may need to demonstrate that the debit was authorised.

Notify the customer before the debit by sending an advance notice. This should include at least:

• the amount;
• the scheduled collection date;
• your name as the creditor;
• the mandate reference or another recognisable reference;
• details of how the customer can contact you.

Clearly specify in your terms and conditions or agreement when you will send the advance notice. For a fixed series of payments with the same amount and collection date, you can provide the customer with a payment schedule in advance. Notify the customer again if the amount or date changes.

Submitting a direct debit

You can submit direct debit instructions in three ways:

• manually via the Pay. Dashboard;
• by submitting multiple instructions at once in a batch file via the Pay. Dashboard;
• automatically via the API.

Manually via the Pay. Dashboard

This option is suitable, for example, if you occasionally want to enter an instruction and do not need a technical integration.

1. Log in to the Pay. Dashboard.
2. Go to Transactions > Direct Debit and select the required type.
3. Click Add.
4. Select the sales location for which Direct Debit has been activated.
5. Enter the account holder’s name and IBAN. Enter the BIC if prompted.
6. Enter the amount, processing date and a clear description.
7. Complete any optional fields as required.
8. For a recurring direct debit, set the interval (for example monthly, quarterly or annually) and the number of repetitions.
9. Check the details and click Add.

You can also create a single or recurring direct debit instruction via the Collect desk.

The processing date is the date on which Pay. starts processing the instruction. It is not the date on which the amount is actually debited; this generally takes place three business days after the processing date. Allow sufficient time between the advance notice and the processing date.

Via a batch file in the Pay. Dashboard

A batch import allows you to submit multiple direct debit instructions at once. Use the Direct Debit Batch Template and, before importing it, check that all account details, amounts, intervals and collection dates are correct. Batch imports are particularly suitable for periodic administrative processing without a full API integration.

Via the API

Use the API to create and track direct debits from your own platform, subscription management system or billing system.

Step 1: Create a mandate

Create a mandate using POST /v2/directdebits/mandates. Include the following details, among others:

• the serviceId of your sales location;
• your own reference and a clear description;
• the type: SINGLE, RECURRING or FLEXIBLE;
• the amount and currency;
• the customer’s personal and bank account details;
• for a recurring direct debit, the interval;
• the required processDate;
• optionally, an exchangeUrl for status notifications.

After creating the mandate, you will receive a mandate ID in the format IO-####-####-####. Store this code in the customer’s record. Each direct debit submitted under the mandate will have its own IL-####-####-#### code.

For a one-off or recurring mandate, Pay. creates the direct debits automatically. For a flexible mandate, the first direct debit is submitted automatically; you initiate subsequent direct debits yourself.

Step 2: For a flexible direct debit, submit a subsequent direct debit

First check that the flexible mandate is active. Then create a subsequent direct debit using POST /v2/directdebits. Include the mandate ID, processing date, amount and description. Use isLastOrder to indicate that this is the final direct debit under the mandate.

Step 3: Process status updates

Pay. can send status changes to the configured exchange URL. You should also check the current status via:

• GET /v2/directdebits/{directDebitId} for a direct debit with an IL code;
• GET /v2/directdebits/mandates/{mandateId} for a mandate with an IO code.

Never treat the creation of an instruction alone as confirmation of payment. Process the final status in your records before marking a payment as successful.

For the full technical explanation, see Direct Debit & Mandates and the API specification for creating a mandate.

Processing time and payout

A direct debit generally takes three business days to process. Once it has been processed, the funds are paid out subject to the release period that applies to your account.

You can find the current release period for Direct Debit under Rates in the Pay. Dashboard. Once the release period has elapsed, the amount will be included in the next clearing.

Checking statuses and handling reversals

A direct debit passes through several statuses. The most relevant are:

Code	Status	Meaning
Common statuses
94	Processed	Pay. has added the direct debit to a batch and submitted it to the bank.
100	Collected	The amount has been collected successfully.
106	Reversed	The amount was not collected. See the reversal reasons for details.
Other statuses
91	Added	Pay. has received the direct debit instruction and it is about to be processed.
526	In batch	The direct debit instruction has been added to a batch.
97	Rejected early	The direct debit instruction has been rejected by Pay.’s system.
103	Deleted	The direct debit instruction has been deleted.
127	Rejected by bank	The direct debit instruction has been rejected by the bank.

A Collected status does not mean that the payment can no longer be reversed. For a consumer direct debit, the account holder may reverse an authorised debit within 56 calendar days (eight weeks) without providing a reason. For an unauthorised debit, an unauthorised direct debit claim (MOI) may be submitted up to 13 months after the debit.

If a direct debit is reversed, the amount will be deducted from your account balance and, where necessary, offset against a subsequent payout.

Resubmitting a failed direct debit

Always check the reversal or rejection reason before submitting another direct debit. Pay. recommends retrying only for reason 109 – Administrative reason, as this may indicate a temporary issue such as insufficient funds. For other reasons, such as a blocked account, a revoked mandate or an incorrect IBAN, retrying will generally not resolve the issue. Contact the customer first.

Limits and important considerations

Standard limits apply to SEPA Direct Debit. These may vary by merchant depending on factors such as the industry and risk assessment.

Item	Standard limit
Instructions per unique IBAN	One direct debit per day
Amount per mandate or direct debit	€100
Total processed amount	€10,000 per seven days