Before the launch of the euro at the last minute the main banks got together - in the Heathrow Group - to sort out the vital technical and operational issues in launching the euro. It is happening again with SEPA Direct Debit scheme which is a mess, particularly on exception handling for SDDs. 

The SEPA Migration Action Round Table (SMART) has published a guidance document providing explanations and best practices in the handling of SEPA Direct Debit-related R-transactions, i.e. rejects, refusals, returns, refunds, reversals, revocations and requests for cancellation. The key recommendations of Guidance on the handling of SDD R-transactions and related charging principles were presented today at SIBOS during the expert panel session of the Euro Banking Association, “The future payments and transaction banking landscape”. 

Chairman of the SEPA Migration Round Table (SMART),  Jan Paul van Pul, Head of Market Infrastructures, ABN AMRO Bank, said that “Putting in place efficient processes for SDD exception handling is one major challenge that banks, and their customers have to face as part of their migration to SEPA. We hope that the practical guidance provided by our forum will help banks across Europe to further increase the straight-through processing rate of R-transactions and – where possible – to reduce their occurrence. Improvements in this area are important because they directly contribute to a positive customer experience and enable a smoother migration to SEPA.” 

Guidance on the handling of SDD R-transactions and related charging principles concentrates on key topics around the issuing and operational processing of R-transactions related to SDD collections. The charging and handling of any fees related to these R-transactions in accordance with the SEPA Regulation are another central focus of the document. 

The document has been delivered by payment practitioners participating in the SEPA Migration Action Round Table and has been endorsed by close to 20 major payment banks across Europe 

(The document ‘Guidance on the handling of SDD R-transactions and related charging principles’ is available for download at www.abe-eba.eu/N=SMART.aspx. )

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Essential reading for any corporate sending or receiving SEPA Direct Debits.