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SEPA Direct Debit offers advantages
Account to Account schemes are still thriving in Europe, in part due to consumers’ local payment preferences. SEPA Direct Debit offers advantages such as lower costs and increased payment security for both merchants and consumers, compared to traditional paper-based direct debits. By offering SEPA Direct Debit as a payment option, you can provide your customers with a convenient and secure payment experience, while also driving growth and improving the bottom line for your business.
What is SEPA- and how does it work?
SEPA Direct Debit is a payment method used in the Single Euro Payments Area (SEPA) region. It allows merchants to collect funds directly from a customer’s bank account, rather than requiring payment via credit/debit card or bank transfer. The customer must provide the merchant with prior authorization to initiate the SEPA Direct Debit transaction(s). Transactions are then processed automatically with that merchant any other time the customer wishes to pay in this manner. This is especially convenient for recurring payments via subscriptions for services, rentals, etc.
How does it work?
1. At online checkout, the consumer chooses SEPA as the preferred payment method.
2. The consumer enters an IBAN/BIC and authorises a direct debit mandate.
3. The consumer receives a notification of funds withdrawal.
4. Payment is confirmed!
Do I need to add another payment method to my online checkout?
Another way to look at this questions is: Do you need more customers? If the answer is yes, let’s explore how this extra payment method can unlock new growth and increase your bottom line.
Here are the facts:
Adding SEPA Direct Debit as a payment option in your e-commerce checkout, can offer several benefits for your business:
- Wider customer reach: SEPA covers 32 countries in Europe, allowing you to expand your customer base and tap into new markets.
- Increased conversion rates: By offering more payment options, including SEPA Direct Debit, you can improve the customer experience and make it easier for customers to complete their purchase.
- Lower transaction costs: SEPA Direct Debit transactions are typically less expensive than credit/debit card transactions, leading to lower processing fees and improved margins for your business.
- Enhanced payment security: SEPA Direct Debit transactions are processed through secure systems and come with strong consumer protection regulations, providing peace of mind for both you and your customers.
- Improved cash flow management: With SEPA Direct Debit, you can receive payments automatically and on a recurring basis, making it easier to manage your cash flow and reduce the risk of missed payments.
By offering your customers even more payment options, you signal to them that their shopping experience is important to you. (And that you are modern, too!)
Vlad
Senior Product Marketing Manager
Vlad is Senior Product Marketing Manager at Nets and works with product updates, including campaigns and customer communication within ecommerce and digital payments.
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