SEPA Direct Debit

SEPA is Direct Debit scheme that operates across the Eurozone.


Payment type Direct Debit
Description SEPA Direct Debit is the Europe-wide Direct Debit system that allows merchants to collect Euro-denominated payments from accounts in the 19 SEPA countries and associated territories. Businesses can access the SEPA scheme directly through their bank or via a third party provider like GoCardless. For more information, see our SEPA Direct Debit user guide
Currency € (Euro)
Key markets Belgium, Austria, Spain, France, Italy, Portugal, Malta, Luxembourg, Cyprus, Germany, Netherlands, Ireland, Finland, Greece, Estonia, Slovenia, Slovakia, Lithuania, Latvia
Key fact More than 50% of non-cash transactions in Germany are processed via SEPA Direct Debit.
Payment use case Recurring transactions, subscriptions, invoicing and instalments (for fixed or variable amounts). For example, online subscriptions, energy and telecom bills, gym memberships, charity donations.
Benefits
  • Significant reduction in involuntary churn - failure rates with Direct Debit are as low as 0.5%.
  • Lower transaction costs compared to cards (1% or less, compared to around 3%).
Considerations Not real-time - 2 to 5 day turnaround on payments, depending on whether you use SEPA core or SEPA B2B scheme, and whether it is the first payment for a particular customer or a subsequent payment.
Example merchants Slack, Netflix, Evernote
Additional facts + figures
  • 20 billion SEPA Direct Debit payments are made every year.
  • More than 20% of electronic transactions across Europe are processed via Direct Debit.
  • SEPA used to be known as ELV in Germany.

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