4 ms·

Living in Germany and my company is based here. We tried SEPA but it’s a PITA to charge customers with it. Especially B2C which we are. Customers can arbitraril

Living in Germany and my company is based here. We tried SEPA but it’s a PITA to charge customers with it. Especially B2C which we are. Customers can arbitrarily chargeback even after several days. Not only that, they can ask for a refund, get the refund and then charge back. So we end up paying them! And there’s no way to prevent it. At least that’s the way it was a few years ago when stripe sepa was still beta. The interesting thing however, we A/B tested with and without SEPA and basically saw no difference. Only German people used it, but when it wasn’t available they managed to find a credit card or use PayPal. I’d love it if banks were making instant payments simple and verifiable, but SEPA feels like something from the 70s to me.

Cu3PO42 7y ago
Minor terminology nitpicking: SEPA is just "Single Euro Payments Area", you're speaking about SEPA direct debit specifically. These concerns still apply to direct debits, unfortunately. The reason being that there's barely any authorization for direct debits, you just need the bank account number and name. Isn't the situation somewhat similar to CC transactions without 3D Secure/whatever it's called? I seems to recall reading in my bank's terms that I can chargeback transactions for something crazy like a year. You always need a "mandate" to debit an account and if you get that properly signed by the customer, you should be able to get the bank to reverse the reversal, but I can appreciate the bureaucratic overhead. I was only offering it as a potential solution if getting people to sign up is genuinely difficult. The thing with PayPal is: they offer direct debit to customers and I'm assuming that's how most people who would've otherwise used direct debit directly with you ended up paying. It is my understanding that PayPal is also aware of the risks associated with this and offers merchants the option not to accept payments through it. I can't seem to find an article just now, but I remember instances where PayPal told me something along the lines of "this merchant does not accept payments via direct debit, please use a credit card instead". I can only assume this is because they at least partially pass on the risk.
- lxgr 7y ago
  > You always need a "mandate" to debit an account and if you get that properly signed by the customer, you should be able to get the bank to reverse the reversal That's unfortunately not true. There is no recourse to direct debit returns; there is no dispute resolution process or anything like that. The presence or absence of a mandate only impacts the timeframe for returns to be files, as far as I understand.
codethief 7y ago
> Customers can arbitrarily chargeback even after several days. You are aware that this is possible with credit cards as well, right?
- plantain 7y ago
  Credit card chargebacks have an appeals / dispute resolution process. SEPA does not.
  - namibj 7y ago
    The process for SEPA is called "sue them"/"press fraud charges".
    - gingerlime 7y ago
      Against who? An email and an IBAN number? For our B2C with relatively small charges it definitely wasn’t worth it. Even CC chargebacks we don’t bother to dispute because the process is painful and virtually impossible to win (banks side with their own customers typically)
      - namibj 7y ago
        The latter, mostly. And I was more referring to the existence of the dispute resolution process, not the viability for random low-value transactions.

Cu3PO42 7y ago

Minor terminology nitpicking: SEPA is just "Single Euro Payments Area", you're speaking about SEPA direct debit specifically. These concerns still apply to direct debits, unfortunately. The reason being that there's barely any authorization for direct debits, you just need the bank account number and name. Isn't the situation somewhat similar to CC transactions without 3D Secure/whatever it's called? I seems to recall reading in my bank's terms that I can chargeback transactions for something crazy like a year. You always need a "mandate" to debit an account and if you get that properly signed by the customer, you should be able to get the bank to reverse the reversal, but I can appreciate the bureaucratic overhead. I was only offering it as a potential solution if getting people to sign up is genuinely difficult. The thing with PayPal is: they offer direct debit to customers and I'm assuming that's how most people who would've otherwise used direct debit directly with you ended up paying. It is my understanding that PayPal is also aware of the risks associated with this and offers merchants the option not to accept payments through it. I can't seem to find an article just now, but I remember instances where PayPal told me something along the lines of "this merchant does not accept payments via direct debit, please use a credit card instead". I can only assume this is because they at least partially pass on the risk.

lxgr 7y ago
> You always need a "mandate" to debit an account and if you get that properly signed by the customer, you should be able to get the bank to reverse the reversal That's unfortunately not true. There is no recourse to direct debit returns; there is no dispute resolution process or anything like that. The presence or absence of a mandate only impacts the timeframe for returns to be files, as far as I understand.

codethief 7y ago

> Customers can arbitrarily chargeback even after several days. You are aware that this is possible with credit cards as well, right?

plantain 7y ago
Credit card chargebacks have an appeals / dispute resolution process. SEPA does not.
- namibj 7y ago
  The process for SEPA is called "sue them"/"press fraud charges".
  - gingerlime 7y ago
    Against who? An email and an IBAN number? For our B2C with relatively small charges it definitely wasn’t worth it. Even CC chargebacks we don’t bother to dispute because the process is painful and virtually impossible to win (banks side with their own customers typically)
    - namibj 7y ago
      The latter, mostly. And I was more referring to the existence of the dispute resolution process, not the viability for random low-value transactions.