The European Payments Council (EPC) Plenary, the decision making and coordination body of EPC, is to launch the SEPA Core Direct Debit Scheme and the SEPA Business to Business Direct Debit Scheme.

The initiative is aimed at European banks which, by signing up for one of the two programs starting 1 May 2009, will be able to provide euro direct debit services as of 1 November 2009, the launch date for the SEPA Direct Debit Schemes which coincides with the deadline for all EU member states to turn the Payment Services Directive into national law.

The SEPA Core Direct Debit Scheme applies to transactions in euro, allowing a creditor to gather funds from a debtor’s account on the condition that the debtor has granted the creditor only one mandate and the credit institution where the debtor and the creditor have opened the accounts is a SEPA participant institution. The program also includes the creation of e-mandates, as an optional service provided by the banks, which are based on online banking services provided by the debtor bank.

The SEPA Business to Business Direct Debit Scheme aims to encourage the development of specific direct debit products and services which allow business customers to make payments via direct debit as debtors (payers).

The Payment Services Directive (PSD) provides the legal foundation to make the Single Euro Payments Area (SEPA) possible. By 1 November 2009, national governments must deploy the PSD provisions enabling banks to finalize SEPA implementation projects. The SEPA Direct Debit Schemes are to create a payment instrument which can be used for domestic and cross-border collection of direct debits across the 31 SEPA countries.