Many legacy direct debit schemes were pretty efficient and allowed creditors to collect according to various business requirements. Some legacy schemes allowed collections to be submitted to the bank / clearing 1 day prior to the collection date. This has now changed under SEPA direct debit CORE processing where the requirement is for collection instructions to be submitted 2 days prior to the due date (for Recurring collections). For many corporates this represented significant business process redesign and change.
- Recognising this shortfall in the CORE scheme, in November 2012 the EPC updated the SEPA Direct Debit rulebook which created a local instrument ‘COR1‘ handling a shorter processing cycle of Due Date-1 day. This allowed the creditor to submit the collection file 1 day before collection date
- COR1 SEPA direct debit collections is a purely optional scheme, and it is up to the bank if they wish to support COR1
- So far only Austria, Germany and Spain support COR1 processing
- Please check with your banks first, or refer to post A Must Visit Website for any SEPA Implementation… to see which banks support COR1
- Given that existing / legacy collection scheme facilitates submitting the direct debit file one day prior to the due date, it is likely that the COR1 scheme will prevail in Austria, Germany, Spain, and CORE will be used for cross border euro currency collections
- Aside from being able to submit the first (FRST) and recurring (RCUR) collections 1 day prior to the due date, all other aspects of COR1 SEPA direct debit collections align with the CORE scheme
- To collect using COR1 you must explicitly refer to the COR1 SEPA direct debit scheme within the XML Payment Information tag as follows:
Let me know if you have any other interesting COR1 SEPA direct debit information to share….