SEPA FAQs

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Changes that will affect customers submitting SEPA Direct Debit Files in 2019

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    What is changing?

    We are moving SEPA Direct Debits to a new payment system, which will mean some changes for our customers. We will be moving our customers to the new system gradually from September 2019. We’ve outlined the changes below. These changes will not result in changes to the SEPA File Formats (PAIN.008/PAIN.002).

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    What changes will I see on my Account Statement?

     1. Changes to Accounting

    • Changing from Net Settlement to Gross Settlement

    Today we post the net value of your SEPA Direct Debit file to your account. This is the value of the Direct Debit file less any collections that are rejected or unpaid before they are settled.

    The new payment system will post the gross value (full value of your file) to your account. We will also debit any of the collections that are unpaid before settlement on the same date.

     

    • Changing from File to Block Credit Value (Collections)

    SEPA Direct Debit files are made up of transactions grouped into ‘blocks’ with similar characteristics.

    The new payment system will post the value to your account in blocks rather than files.  If you have one block, you will see one credit and if you have multiple blocks you will see multiple credits.

     

    • Changing from File to Block Debit Value (Unpaids)

    The new payment system will post all unpaid collections in separate blocks to your account.  Collections that are unpaid before settlement will also be grouped per block and per day received. You may see more than one debit posting per block on your account for your collections that are unpaid before settlement.

    Here’s what it will look like on your account:

    This example shows two files, settled on the same due date.

    • File 1 has two blocks, with the same due date. Each block has a value of €500, so a total file value of €1000
    • File 2 has two blocks, with the same due date. Block 1 has a value of €200, Block 2 has a value of €300, so a total file value of €500

     

    Account Statement
      Before the change After the change
    DueDue date (am) date (am)

    File 1 and File 2 (Block 1 and Block 2) Net credit posting

     

    Credit Received File 1: €900

    Credit Received File 2: €480

    File 1 and File 2 (Block 1 and Block 2) Gross credit posting

    Credit Received File 1 Block 1 €500

    Credit Received File 1 Block 2 €500

     

    Credit Received File 2 Block 1 €200

    Credit Received File 2 Block 2 €300

     

    Debit Received File 1 Block 1 €40

    Debit Received File 1 Block 2 €60

    Debit Received File 2 Block 1 €10

    Debit Received File 2 Block 2 €10

    Balance at end of due date

    €1380

    €1380

    Due date + 1

    Debit Received (Rejects received on D)

    File 1 €40

    File 2: €30

    Debit Received File 1 Block 1 €20

    Debit Received File 1 Block 2 €20

    Debit Received File 2 Block 1 €20

    Debit Received File 2 Block 2 €10

    Balance at end of

    due date + 1

    €1310

    €1310

     

    2. Changes to Narratives

    When you move to the new payment system reconciliation of your account will become more straightforward as a result of new information provided.

    This table shows how debits and credits for SEPA Direct Debit files will appear on your Account Statement when moved to the new payment system.
     

    Narratives:

    Settlement Timeline

    Before the change After the change
    Due Date

    Net Posting of 1 Credit PER ENTIRE FILE

    This is how we narrate the settlement of your file;

    Line 1: SEPA DD and date (Julian format)

    Line 2: The file reference we generate

    Gross Posting of Credit PER BLOCK

    Following the change the new narrative for the settlement of your file will be;

    Line 1: DD and Payment Information Id (this is the Block reference from your PAIN.008 file)

    Line 2: The file reference we generate (no change)

    Pre-Settlement unpaids

    N/A

    (These are deducted from the value of your file, before the net value is posted to your account).

    Unpaids are grouped by block and you can have multiple blocks per file, thus multiple entries.

    Line 1: RJ and Payment Information Id (this is the Block reference from your PAIN.008 file)

    Line 2: The file reference we generate

    Post-Settlement unpaids

    Line 1: SEPA DD and date Julian format)

     

    Line 2: The file reference we generate

    Unpaids are grouped by block and you can have multiple blocks per file, and as a result multiple posts.

     

    Line 1: RT and Payment Information Id (this is the Block reference from your PAIN.008 file)

    Line 2: The file reference we generate (no change)

     

    • How have we made your account reconciliation easier?

    You will have more control of the narratives posted to your account for your SEPA Direct Debit files. The SEPA Direct Debit file you send to us contains a mandatory field which acts as your reference for the ‘block’ or group of collections. As outlined in the table above, once you are moved to the new payment system this block reference will be detailed on your account next to the value of your file and unpaids.

    This field or ‘tag’ from the XML PAIN.008 file is called the ‘Payment Information Id’ and you can find it in the Payment Information Block. We will continue to show this field in your PAIN.002 messages.

     

    • Interim Period

    There will be an interim period where you may see both gross and net posting on your account up to 13 months after your move to the new payment system. This is because once we receive a payment file onto our existing system, we will continue to process that file for the whole cycle (up to 13 months). Any files you send us after your move to our new payment system will be processed by our new system so you will receive gross posting.

     

    • Transaction charge to be applied by block not by file

    If you submit a single or multi block SDD file, we currently charge you €0.20 for each file you send us. This charge is incurred as part of your quarterly current account fees, as an ‘automated transaction charge’. However, according to our terms and conditions the charge should be €0.20 for each transaction block within that file. 

    Therefore, from September 2019, we will charge you €0.20 for each transaction block.

     

    • What does this mean for you?
      • If you send us a file with a single block of payments, the €0.20 transaction charge will apply.
      • If you send us a file with multiple blocks of payments, the €0.20 transaction charge will apply to each block in the file.

     

    • How can I avoid extra charges?

    The best way to avoid additional charges, is to change your file submission to one transaction block per file. Many customers send us files with multiple transaction blocks as this was the process outlined by now outdated SEPA scheme rules. If you do use multiple transaction blocks, please review the files you submit and see if you still need to submit files with multiple transaction blocks.

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    What changes will there be to file submission timelines or collection dates?

    • File Submission timelines

    Once you move to the new payment system you can benefit from the extended cut off time for your SEPA Direct Debit files. We will be able to accept files one business day before the due date (D – 1) of the file, subject to the cut off time of 11am.

     

    • Multiple Collection dates

    Today it is not possible to upload a SEPA Direct Debit file with multiple collection dates, however, when you move to the new payment system you will be able to do so.

     

    • File Processing Timelines

    Today we begin processing files you send us to D-30 (30 days before due date of your file). When you move to the new payment system you can continue to send us files up to D-30 however we will only begin processing your files from D-14 (14 days before due date of your file). This means that the earliest you will start receiving unpaids will be D-13 (13 days before due date of your file).

     

    • SDD Files that have ‘Expired’

    Today if you upload but do not authorize a file before the cut off time, by the end of the same business day your file status will update to ‘Expired’. After you move to the new payment system files uploaded and not authorized before 4pm will display the error message ‘auth failed, date in past.’

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    What are the next steps?

    • Review the changes outlined on this webpage and consider how it affects your processes.
    • We will be back in touch to communicate the date for you to move to the new payment system.
    • If you use a third party to process or reconcile your direct debit files you will need to tell them about this change.
    • If you have any more questions, we’re ready to help just call us on 0818 72 00 00 (+353 1 641 4889 from outside Ireland).

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    Do you send us files more than 14 days in advance of the direct debit file due date?

    Our new payment system will start validating the transactions in your files 14 days in advance of the direct debit file due date, even if the file is submitted earlier. Before these checks have started, your file status will always appear as ‘Authorised’ or ‘File Accepted’.

    From 14 days before the due date (D-14) this check will be completed and if there are errors, the status will change to ‘Authorised with errors’ or ‘File Accepted with errors’.

    The table shows how your files will display if you send them to us within 14 days of the due date:

    Post Authorisation Single and Multi-block Files

    File Status

    Block Status

    Single Block (Post-Auth)

    Authorised

    Authorised

    Single Block with error (Post-Auth)

    Authorised with errors

    Authorised with errors

    Multi-Block (Post-Auth)

    File Accepted

    File Accepted

    Multi-Block with error (Post-Auth)

    File Accepted with errors

    File Accepted with errors

     

    The table shows how your files will display if you send them to us more than 14 days in advance of the due date:

    Post Authorisation Single and Multi-block Files

    File Status

    Block Status

    Single Block (Post-Auth)

    Authorised

    Authorised

    Single Block with error (Post-Auth)

    Authorised

    Authorised

    Multi-Block (Post-Auth)

    File Accepted

    Authorised

    Multi-Block with error (Post-Auth)

    File Accepted

    Authorised

     

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About SEPA

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    What is SEPA?

    The Single Euro Payments Area (SEPA) is a European-wide initiative to standardise the way we make and process electronic payments in Euro. SEPA enables customers to make payments (direct debits, credit transfers) to anyone located within the SEPA Zone. SEPA creates a fast, safe and efficient borderless payment system throughout the 34 SEPA countries.

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    What currencies are covered under SEPA?

    SEPA covers Euro denominated transactions only.

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    What payment types are covered under SEPA?

    There are three payment types involved in SEPA:
    - SEPA Credit Transfer Scheme
    - SEPA Direct Debit Scheme
    - SEPA Cards Framework

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    What countries are in the SEPA zone?

    There are 28 EU member states and a number of additional SEPA zone territories

    The 28 EU States:

    Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovak Republic,  Slovenia, Spain, Sweden and United Kingdom

    Other countries and territories, which tend to change periodically.

    Aland Islands, Andorra, Azores, Canary Islands, French Guiana, Gibraltar, Guadeloupe, Guernsey, Iceland, Isle of Man, Jersey, Liechtenstein, Madeira, Martinique, Mayotte, Monaco, Norway, Reunion, Saint Barthelemy, Saint Martin, Saint Pierre and Miquelon, San Marino, Switzerland and Vatican City

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    Where can I get further information on SEPA?

    Further information on SEPA and SEPA implementation can be found by visiting www.aib.ie/sepa.

    SEPA related queries can be directed to sepa@aib.ie or 0818 72 0000.

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BIC & IBAN

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    What is a Bank Identifier Code (BIC)?

    A Bank Identifier Code (BIC), also known as the SWIFT Address, is a unique identification code for a specific financial institution. BIC is no longer mandatory for SEPA payments.

    AIB’s BIC is AIBKIE2D

    BIC codes consist of either 8 or 11 alphanumeric characteristics and can be verified using the following website: www.swift.com/biconline

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    What is an International Bank Account Number (IBAN)?

    The International Bank Account Number (IBAN) is a standardised European bank account number.  The IBAN is now  the sole payment account identifier for electronic national, international and cross-border credit transfers and direct debits in Euro within the EU.

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    What does an IBAN look like?

    The IBAN is not a new account number and does not replace an account holder’s existing bank account details. Additional characters are added to form the verifiable and unique IBAN for each account that is already in place.

    The following is an example of an IBAN for an Irish Bank Account:

    IE33AIBK93123487654321

    IE                      Country Code for the Republic of Ireland

    33                     Two digit check number

    AIBK                 First four digits of Bank Identifier Code (BIC)

    931234            National Sort Code

    87654321        Account Number

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    Where can I get my IBAN and BIC?

    Details of your IBAN and AIB’s BIC are printed on your account statement. You can also refer to your account holding branch or Relationship Manager for this information. Your BIC and IBAN can also be found on most online banking services, such as AIB Internet Banking and iBusiness Banking (iBB).

    Please refer to the intended receiver of your payments to obtain their respective IBAN details for outgoing payments.

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    Where will I get my customers’ BIC and IBAN?

    You will be able to get your customers’ BIC and IBAN by:

    1. Going directly to your customers
    2. Using the BIC and IBAN conversion service provided by the Banking and Payments Federation Ireland (BPFI) for use by both individual consumers and businesses. This service will enable bank customers to convert their existing NSCs (national sort codes) and account numbers to the BIC and IBAN standard required for SEPA. For further information on how this BIC and IBAN conversion service works please visit the BPFI website www.bfpi.ie

    Note: The BIC and IBAN conversion service is free of charge.

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SEPA Credit Transfers

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    What is the SEPA Credit Transfer (SCT) Scheme?

    The SCT scheme ensures customers can make electronic payments to any customer located anywhere in the SEPA zone using a single bank account (IBAN) and a uniform set of standards, rules and conditions. For example, an Irish customer with a holiday home in Spain can now pay all utility bills relating to the Spanish property from one domestic account in Ireland. Also, foreign nationals working in Ireland may have their salaries paid directly into their domestic account, eliminating the need to open many different bank accounts.

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    How long will it take for a SEPA Bulk credit transfer to reach the beneficiary?

    If you upload and authorise the payment file on iBB by 16:00, the beneficiary will receive the money on the next business day. For example, if the beneficiary is supposed to receive funds on the 28th March, the file must be submitted on iBB by 16:00 on 27th March.

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SEPA Direct Debits

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    What is the SEPA Direct Debit (SDD) Scheme?

    The SDD scheme is an interbank payment scheme defining a common set of rules and standard procedures for direct debits in Euro. The scheme ensures a common level of service within the participating countries. The file submission timeframes under the scheme rules is 1 business banking day for all SEPA Direct Debit payments. However AIB customers will be required to submit their payment files to iBB a minimum of one AIB business day earlier (i.e. 2 business banking days prior to the debit date).

    This is required to allow for submission cut-off times and internal processing.

    Financial institutions must also provide SEPA-wide access, meaning that Direct Debits can be made from any domestic account to any receiver within the participating countries. For example, an Irish customer with a holiday home in Spain may pay all utility bills relating to the Spanish property from one domestic account in Ireland.

    The SDD scheme provides for both recurring and once-off payments in Euro, allowing a customer to make a once-off major purchase, such as a car, and pay by direct debit. IBAN must be used, and a comprehensive set of rules for rejected and returned payments is provided.

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    How long will it take to collect on a SEPA Direct Debit (i.e. clearing cycle)?

    AIB’s clearing cycle for a SEPA Direct Debit (SDD) is 2 AIB business banking days prior to the collection date of a payment.

    Files can be submitted a maximum of D-30 where D=Debit Date and -30 = 30 calendar days before the debit date. SDD files containing any FRST, RCUR, OOFF and/or FNAL sequence types must be submitted by the originator on D-2 at a minimum.

    The D-2 timeframe is based on the TARGET calendar. Normal TARGET working days are Monday to Friday. There are 6 TARGET holiday days each year: New Year’s Day 1st January, Good Friday, Easter Monday, May Day 1st May, Christmas Day, Stephen’s Day. SEPA settlements are closed on these days, which will affect the execution timelines. These TARGET holidays will impact the file delivery and settlement cycles, even if it is a normal working day in Ireland.

    On Irish holiday funds will not be credited to / debited from Customers accounts even if the day is a TARGET day.

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    Key Features of the SEPA Direct Debit scheme

    • A new SEPA Creditor ID will be issued by AIB.
    • You will need to submit payment files to iBB a minimum of two business banking days in advance for a first, once off, recurring or final payment collection.
    • You will have responsibility for the creation of a unique mandate reference (UMR) for each new SEPA mandate, and mandate details will travel with every collection on the XML file.
    • Mandates and mandate storage is the sole responsibility of the originator.
    • The debtor must be pre-notified of the collection at least 14 calendar days before the actual collection takes place.

     

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    What are the new transaction codes for SEPA Direct Debits and when are they used?

     

    FRST – Can be used for the first collection in a series of SEPA DDs and submitted at least 2 business banking days prior to the required collection date.

    Note that, If the collection is rejected or returned post-settlement or pre-settlement, the collection can be re-submitted as a FRST or RCUR.

    RCUR - Can be used for SEPA DD transactions, which form part of a series of collections and submitted at least two business banking days prior to the required collection date.

    FNAL - To be used to signify the final SDD collection in a series and submitted at least two business banking days prior to the required collection date. A RCUR transaction code may also be used in this situation and will not reject. In this case, the mandate will remain valid for a further 36 months.

    OOFF - To be used for once-off SDD collections and submitted at least two banking business days prior to the required collection date. A Unique Mandate Reference (UMR), which is used for an OOFF transaction, cannot be used for a second time.


    Note that, if the collection is rejected or returned pre-settlement, it will be necessary to re-submit the collection as an OOFF with the same UMR. If the collection is rejected or returned post-settlement, the collection must be submitted as a new OOFF with a new UMR.

     

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Benefits of SEPA

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    What are the fees for Payment Files?

    The fee is €0.07 per payment, with a minimum charge of €6.35 per month.

    We accrue fees each month and charge them to your billing account every quarter (Dec-Feb, March-May, June-August, Sept-Nov). We will give you a detailed breakdown of the fees we are charging 10 days in advance.

    Once you authorise a file we will assume it will be processed and charge you for each transaction in the file, whether or not the payment goes through.

    *If there is not enough money in your account on the day you want the payment to go through, we will reject the file, with the narrative “Failed for funds – Auto retry”. We will try to put the payment through right up to 10 minutes before the 16:00 deadline, to give you time to put money into the account. We do this automatically so you don’t need to authorise the payment again, you just need to fund the account to cover the payment.

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