SEPA event 11 December 2012 2

SEPA Direct Debit In SAP

012

SEPA Direct Debit in SAP

Agenda
Introduction
SEPA: European direct debit
SAP SEPA DD features
Take aways

Sheet 2

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 2

SEPA: European direct debit

SEPA Core Direct Debit Scheme (SDD Core)

and the SEPA Business to Business Direct
Debit Scheme (SDD B2B) create for the first
time a payment instrument that can be used
for both domestic and cross-border collections
throughout the 32 SEPA countries

The SEPA Schemes define sets of rules and

standards for the execution of SEPA payment
transactions that have to be observed by
payment service providers (PSPs).

Are we ready in time?

3
Sheet 3

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 3

SEPA Direct Debit: CORE and B2B

SEPA Core Direct Debit Scheme (SDD)

SEPA Business to Business

The payer and the biller must each hold an account with a

The

SDD B2B Scheme enables business customers in the role

payment service provider (PSP) located in SEPA country.

of payers to make payments by direct debit.

The

Services

SDD Core Scheme allows a biller to collect funds from a

payers account provided that a signed mandate has been

and products based on the SDD B2B Scheme are only

available to businesses

granted by the payer to the biller

In
The

SDD Scheme may be used for single (one-off) or recurrent

the SDD B2B Scheme the payer (a business) is not entitled

to obtain a refund of an authorized transaction.

direct debit collections, the amounts are not limited.

The
Even

exceeding the requirements of the Payment Services

SDD B2B Scheme requires the payers bank to ensure that

the collection is authorized by checking the collection against

Directive (PSD), the SDD Core Scheme grants payers a no-

mandate information; the payers bank and the payer are

questions-asked refund right during the eight weeks

required to agree on the verification to be performed for each

following the debiting of a payers account

SEPA B2B direct debit.

Responding

The

payers bank must receive the request for direct debit

collection latest five business days prior to the due date.

to the specific needs of the business community the

B2B Scheme offers a significantly shorter timeline for

presenting direct debits

4
Sheet 4

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 4

SEPA Direct Debit: jargon/aspects

IBAN and BIC
Only permissible account and bank identifiers for SEPA transactions

Mandates
Signed by the payer to authorize the on the first day of each month biller to collect a payment and
to instruct the payers bank to pay those collections.

E-Mandate
SDD Schemes: possibility to create mandates through the use of electronic channels

Due Date
The SDD Schemes allow payers and billers to anticipate the precise (due) date

Pre-notification
Biller -> Payer, 14 days before collection is standard.
Pre-notification includes the due date and the amount of the collection

Creditor Identifier
Each biller in SEPA will be identified with a creditor identifier

SEPA data format

The ISO 20022 message standards

Sheet 5

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 5

SEPA Direct Debit : SAP supports the Business

Mandate Management Process in SAP
Design , Implementation and use of the Company mandate forms
Record the data from the mandates in SAP system
Approval process for Mandate management
Master data allocation to mandate for SEPA DD

Information via invoicing and pre-notification to Customer

BCM SWIFT Connection for a European DD contract with Core Bank
Payment process and submitting European direct debit batches
XML enablement of the new standard European SEPA payment formats
SEPA Direct Debit based on EPC Rulebook V.3.3 (Core) and V.1.2 (B2B)Automatic
Processing of Payment order
Significant approval of the Collection order
Straightforward reconciliation of payments received
Ability to automate exception handling (refunds, returns, rejects)

Sheet 6

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 6

SEPA Direct Debit : the full process in SAP

Sheet 7

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 7

Management of SEPA Direct Debit Mandates in SAP

Features
Administration:
Mandate administration including creation, change,
status tracking, and deletion of mandates
SEPA_MANDATE for PDF and SEPA_MANDATE
for SmartForms
Payment processing
Integrate the mandates and operational processes,
such as periodic payment runs For example, each
payment run will ensure that SEPA Direct Debits
are processed only when a valid mandate exists
The payment program checks the existence and
validity of the SEPA mandate
The system stores the ID of the SEPA mandate in
the payment data and generates a SEPA-specific
payment medium as a result

8
Sheet 8

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 8

Management of SEPA Direct Debit Mandates in SAP

Features
Administration:
Mandate administration including creation, change,
status tracking, and deletion of mandates
SEPA_MANDATE for PDF and SEPA_MANDATE
for SmartForms
Payment processing
Integrate the mandates and operational processes,
such as periodic payment runs For example, each
payment run will ensure that SEPA Direct Debits
are processed only when a valid mandate exists
The payment program checks the existence and
validity of the SEPA mandate
The system stores the ID of the SEPA mandate in
the payment data and generates a SEPA-specific
payment medium as a result

9
Sheet 9

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 9

SAP ISO 20022 CGI Mapping Group

Purpose
Develop mappings of CGI guidelines to SAP
internal Data Fields
Deliverables
Individual maps DMEE/PMW XML Format, PI
XML Schema, Supporting user documentation
with explanations, amplifications, and guidance
Benefits
Harmonisation allows a messaging template to
be established.
Enables and reduce the future costs associated
with banking integration.
Improves the overall visibility, monitoring and
control through simplification through
standardisation.

10
Sheet 10

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 10

SAP optimized Bank Connectivity

SAP

Service Provider

SAP ERP
Accounts
Payables
Accounts
Receivables
Receivable
Treasury

SAP Bank Communication

Management

SAP NetWeaver
Process
Integration

Banks

SWIFTNet
Interface

SWIFTNet
SAP
Integration Package
for SWIFT

Other

Sheet 11

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 11

Bank Communication Process Flow

SAP ERP

Execute
Payment
Program
SEPA DD
Payment
Order

Import
Bank
Statement
Post/Processing
and
Clearing

Sheet 12

Qrcus BV 2012

SAP Bank
Communication
Management

SAP NetWeaver
Process Integration

Create Batch

Routing

Payment Approval
Work List

Mapping

Security
- Approval
workflow
- Authorization
- Digital signature

Security
Encryption
Digital Signature

Receive Status
Messages

Bank Statement

SWIFTNet

SAP Integration
Package for
SWIFT

Resource
Adapter

SEPA Seminar December 2012

SWIFT
Alliance
Access /
Gateway

Sheet 12

Payment run

SEPA DD
Demo

Mandate Management
Processing

Payment Collection
Processing

Bank Communication
Management ->
Approve Payments
Second Approval
Processing -> Approve
Payments
Status Management ->
Batch and Payment
Monitor
Audit Trail

AR
Team

Sheet 13

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 13

Payment run

SEPA DD
Demo

Mandate Management
Processing

Payment Collection
Processing

Bank Communication
Management ->
Approve Payments
Second Approval
Processing -> Approve
Payments
Status Management ->
Batch and Payment
Monitor
Audit Trail

AR
Team

Sheet 14

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 14

First Approve Payments

SEPA DD
Demo

Mandate Management
Processing

Payment Collection
Processing

Bank Communication
Management ->
Approve Payments
Second Approval
Processing -> Approve
Payments
Status Management ->
Batch and Payment
Monitor
Audit Trail

First
Approver

Sheet 15

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 15

Second Approve Payments

SEPA DD
Demo

Mandate Management
Processing

Payment Collection
Processing

Bank Communication
Management ->
Approve Payments
Second Approval
Processing -> Approve
Payments
Status Management ->
Batch and Payment
Monitor
Audit Trail

Second
Approver

Sheet 16

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 16

Batch and Payment Monitor

SEPA DD
Demo

Mandate Management
Processing

Payment Collection
Processing

Bank Communication
Management ->
Approve Payments
Second Approval
Processing -> Approve
Payments
Status Management ->
Batch and Payment
Monitor
Audit Trail

Batch
Cash
creator
Manager

Sheet 17

Qrcus BV 2012

First
Second
Approver Approver

SEPA Seminar December 2012

Sheet 17

Audit Trail

SEPA DD
Demo

Mandate Management
Processing

Payment Collection
Processing

Bank Communication
Management ->
Approve Payments
Second Approval
Processing -> Approve
Payments
Status Management ->
Batch and Payment
Monitor
Audit Trail

ISO XML file

Cash
Manager

Sheet 18

Qrcus BV 2012

First
Approver

Second
Approver

SEPA Seminar December 2012

Sheet 18

Take aways
Approach SEPA (Payments as well as Direct Debits) as a process
improvements rather than as a mandatory system-fix;
Focus on adding value to your Business: optimization and de-complexing

Advices (not limitative)

Appoint a dedicated team (business and IT) and adopt a plan of approach
Consider to use Best practice of SAP : SEPA and BCM
Arrange Participation of your Bank in your project
Contact and communicate with your Customers in time
Arrange Guidelines/regulations: Mandate Management, Invoicing, pre-notification, refund
periods, block procedures,
Phase-out local Direct Debits

Sheet 19

Qrcus BV 2012

SEPA Seminar December 2012

Sheet 19