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Italian IBAN discrimination: direct debits

  • Updated
If your Italian (IT) IBAN is rejected for a direct debit in Italy, it’s likely because your service provider uses SEDA (SEPA-compliant Electronic Database Alignment), a local verification system. This article provides the necessary steps to resolve IT IBAN discrimination and successfully set up your payment mandate.

Understanding SEDA and IT IBAN discrimination

SEDA allows companies, such as utility or telecom providers, to verify a mandate with your bank before processing the first payment. 
 
Because SEDA is an optional service specific to Italy, Swan doesn’t participate in this scheme. When a provider's automated system requests a SEDA confirmation and Swan doesn't respond, the request is automatically rejected.
 
If a provider rejects your valid SEPA IBAN because it requires SEDA, this may be inconsistent with the non-discrimination principle set out in EU law (see Article 9 of SEPA Regulation No. 260/2012).

Resolving IT IBAN discrimination

Some providers only accept direct debits through SEDA. While this may go against EU law, Swan can't force them to change. There's no guarantee you'll be able to set up your direct debit. 

If your IBAN isn’t accepted, follow these steps to set up your direct debit:

  1. Contact the provider and gather evidence

    Ask for an alternative mandate process (paper or electronic) and document all interactions. You can use this template.

    Subject: SEPA Direct Debit setup - Request for alternative mandate process

    Dear [Company Name],

    I am unable to set up a direct debit using my Swan Italian IBAN. My IBAN has been rejected because you use the SEDA scheme, which my bank does not participate in.

    SEDA is an optional service and not a requirement under SEPA rules. Refusing a valid European IBAN based on SEDA participation constitutes IBAN discrimination under Article 9 of SEPA Regulation No. 260/2012.

    Please update your system to accept my IBAN or provide an alternative way to set up my direct debit mandate (such as a paper or electronic mandate).

    My account details are as follows:

    • SEPA IBAN: [Insert your IBAN]
    • Account holder name: [Insert the name associated with your account]
    • Bank: Swan
    • ABI code: 36832

    I look forward to your response within 15 business days, as required by payment services regulations. 

    If this isn't resolved, I'll have to escalate the matter to the relevant Italian authority.

    Best regards,

    [Your Name]

    ➡️ While waiting, you can use a different payment method (Step 2). Go to Step 3 if the provider explicitly refuses to offer an alternative mandate process or if 15 business days pass without a response.

  2. Use a different payment method

    If the provider’s system strictly requires SEDA, you may need to use an alternative payment method, such as a card or SEPA Credit Transfer.

  3. Report the issue to the relevant authority

    If the provider refuses your IBAN and doesn't offer an alternative, you can file a formal complaint with the relevant Italian authority.

Sector Authority How to report
Telecom, Internet, TV AGCOM Conciliaweb
All other sectors Banca d'Italia Online Complaint Portal

When filing a complaint, include:

  • The issue: Direct debit blocked due to SEDA. SEDA is optional, and Swan doesn't support SEDA.
  • Legal basis: Article 9, Regulation (EU) No. 260/2012.
  • Timeline: Dates you contacted the company and their responses, or lack thereof.
  • Evidence: Screenshots of the rejection and copies of your correspondence.

If no resolution is available

If the provider’s system strictly requires SEDA, it won’t be possible to use your Swan account for that specific direct debit. Use an account at a bank that participates in the SEDA scheme.

If you have further questions, submit a request to Swan Support.