Direct debit is a payment initiated by a creditor to take funds from your account. The debtor (you) authorizes another account, such as a utility or real estate company, to withdraw a mandated amount from your payment account.
Direct debit overview
- After your payment mandate is approved and activated, your payment account provider checks that your Available balance can cover the payment amount.
Tip
đź’ˇ Read this article on SEPA Direct Debit mandates to learn more about how to permit a company to withdraw money from your account.
- The amount is debited from your account, resulting in a reduction in your Available balance.
- The transaction appears in your transaction history labeled direct debit.
Direct debit types
The following table provides a description of the direct debit types available for your payment account, and eligible account types:
Direct debit type | Description | Eligible account types |
---|---|---|
SEPA Direct Debit Core (SDD Core) | Payment in euros from a company account to an individual or company account within SEPA. | Individual and company accounts |
SEPA Direct Debit B2B (SDD B2B) | Payment in euros from a company account to another company account within SEPA. | Company accounts only |
Internal Direct Debit Standard (IDD Standard) | Payment from a company account to an individual or company account using the same payment account provider. | Individual and company accounts |
Internal Direct Debit B2B (IDD B2B) | Payment from a company account to another company account using the same banking service provider. | Company accounts only |
Direct debit rejections, refunds, returns, reversals, and cancellations
After a direct debit is set up from your account, the funds are debited from your account. Sometimes outgoing SEPA Direct Debits can be rejected or reversed, and canceled by the creditor.
Completed direct debits appear on your official account statement and impact your Available balance.
Transaction type | Explanation | Type of direct debit | Time frame |
---|---|---|---|
Rejection | Account members with permission to initiate payments can request to reject an upcoming SEPA Direct Debit. A rejection won’t impact your account balance. | All SEPA Direct Debits | Anytime before the scheduled debit |
Refund | Refunds can be requested by the debtor. You can ask for a refund up to 8 weeks after the transaction execution with no questions asked. You can also ask for a refund up to 13 months after execution for an invalid mandate or an unauthorized payment. | SEPA Direct Debit Core, Internal Direct Debit Standard | Up to 8 weeks after execution; Up to 13 months for issues |
Return | Returns by the debtor's bank are possible within a specific time frame. | SEPA Direct Debit B2B, SEPA Direct Debit Core, Internal Direct Debit B2B, Internal Direct Debit Standard | Up to 3 business days (B2B), Up to 5 days (Core/Standard) |
Reversal | Creditors can reverse a completed transaction, labeled as 'Booked' in your transaction history. | All SEPA Direct Debits | Up to 5 business days after due date |
Cancellation | Creditors can cancel upcoming SEPA Direct Debit transactions. A cancellation won’t impact your account balance. | All SEPA Direct Debits | Anytime before the scheduled debit |
If you have further questions, submit a request to Swan Support.