SEPA Direct Debit shows great acceptance – migration deadline in sight

By Josef Etz on 11. July 2014 in Market Insights, Open Payment Technology

The migration to SEPA Direct Debit is running successfully. The majority of direct debit traffic in Europe has already switched to SEPA. In Germany, the largest direct debit market in Europe, already in April SEPA Direct Debit transactions amounted to 62% of all payment transactions by direct debit. This is an increase of 33% as from January of this year (January: 29%) (Source: ECB)


At PAY.ON we can confirm the ECB position that SEPA is a success: 70% of all our direct debit transactions today are already SEPA Direct Debit transactions. This indicates that PAY.ON clients exceed the market average by 8%. This is due to our clients’ expertise and our turnkey migration support.


However high the migration rate, many online merchants today still offer payment forms for the old national account details. The conversion to the new European SEPA Direct Debit standard is invisible and unknown to the online shopper as it takes place behind the scenes. From a shopper’s perspective, the visibility of SEPA is thus much lower than the 62% mentioned. We strongly recommend merchants not to aggressively force online shoppers to enter IBAN and BIC data, but to implement data conversion services instead. Further, the shopper should have the option to choose between the old and new format, and thus be able to enter IBAN and BIC data easily.


In conclusion, the big players are happy with the migration to SEPA Direct Debit and are starting to benefit from the advantages of SEPA, for example from true cross-border payment across Europe.


Hence, for payment service providers and merchants who are still not processing SEPA Direct Debit, they should carry out the migration along the now proven migration path. Don’t hope for another delay. There won’t be one! The deadline for migration is August 1, 2014.


Josef Etz

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