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27 May 2016

Publication of the EPC recommendations on the validity of electronic mandates in a cross-border context

The EPC published ‘Recommendations on the Validity of Electronic Mandates in a Cross-Border Context’. The purpose of this document is to draw the attention of SDD scheme participants on guidelines on the security of internet payments from the European Banking Authority (EBA).

These EBA guidelines constitute minimum requirements for PSPs regarding the security of internet payments and also cover the issuance and amendment of direct debit electronic mandates. Procedures for strong customer authentication is one of the key requirements that SDD scheme participants are expected to have in place, in line with the definition provided in the EBA guidelines. This requirement has particular importance in the case of cross-border SDD collections.

Handling and accepting efficiently electronic mandates at national and cross-border levels is essential to the further development of the SEPA Direct Debit (SDD) Core and Business to Business (B2B) Schemes. In order to provide clarification for debtor Payment Service Providers (PSPs) regarding the methods of electronic signatures which – notably in a cross-border context – could give assurance to the debtor PSP that the mandate can be considered as having been authorised by the debtor with a legally binding method of signature, the European Payments Council (EPC) has produced some recommendations.

The document further recommends the SDD scheme participants to analyse the guidance notes and / or frequently asked questions from their relevant national competent authority with respect to these EBA guidelines. In the event of doubt about the validity of certain types of electronic mandates, the SDD scheme participants should address their question to their competent national authority.

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