PARIS | MyBank announced the successful completion of piloting its electronic mandate solution. Seven service providers participating in the MyBank Mandate pilot have successfully tested user-friendliness, business processes and technical infrastructure of the e-mandate solution. MyBank Mandates enable merchants, public institutions and utility across Europe to safely collect SEPA Direct Debit payments.
MyBank Mandate Pilot Participants
During the testing phase, 3 financial institutions, 12 service providers from 5 countries and 5 merchants (telephone, insurance and utility sector) participated. As service providers there were IT vendors for banks, mandate management providers and some of the new SEPA based e-mandate providers such as AcceptMail, Twikey and Slimpay.
MyBank and Ecommerce Merchants
By using MyBank Mandates, online shoppers authorise online merchants to debit the transaction amount from their bank account. The MyBank Mandate solution is basically the pan-European, SEPA compliant, technical framework that simplifies this authorization process. It allows consumers to use their online or mobile banking environment to authorise SEPA Direct Debits (SDD) with the merchant being notified in real-time. To put in other words, MyBank Mandates enables online merchants to provide their customers a real-time checkout experience. Mandates can be provided for single and recurring direct debits.
The benefits of SEPA Direct Debits for merchants
MyBank Mandates enable merchants to collect payments from shoppers across the Eurozone area, without the need to have local bank relationships and bank accounts from which direct debits are initiated. It strongly reduces the administrative burden, improves the reconciliation process for both domestic and cross-Eurozone direct debits and reduces operational costs considerably. Compared to other forms of online payments like cards, the acceptance of 'MyBank payments' is less fraud-prone and provides short settlement timeframes. John Broxis, Managing Director of MyBank, said: “MyBank provides real solutions to real problems linked to SEPA migration; these solutions reduce costs and improve working capital flows. The demand by merchants for a pan-European electronic mandate solution is clear, and banks will be able to help them provide such a solution to their customers.”
SEPA provides more consumer protection
SEPA direct debits provide ease for (online) businesses to collect payments, however, there is also a potential downside. Consumers approving direct debits are allowed to reverse payment up till 56 days after the direct debit was processed, and without the need for giving grounds. It is important for business to recognise this risk and to determine if they can accept the change of having transactions reversed. It also means businesses should be prepared for such situations to arise and take appropriate, and maybe costly measures. The MyBank initiative also enables SEPA Credit Transfer (SCT) payments which can not be reversed by the consumer (they take action to complete payment (credit transfer) instead of a direct debit where the merchants takes action).
MyBank Mandate solution is expected to be available later in 2014
MyBank currently counts 51 participants, which make the solution available to over 10 million retail customers for the initiation of SEPA Credit Transfers. MyBank is already available in three countries with participants in France, Luxembourg and Italy, where MyBank has a particularly strong customer base with utility and insurance companies as well as government agencies demonstrating a keen interest in the MyBank Mandate solution to replace legacy processes. It is foreseen that MyBank will be available across the Eurozone within the next two years.
Excerpts were taken from MyBank Press Release, February 19th, 2014.