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Payment Receipts

SEPA Direct Debit in Cash Receipt Journal

Business Value

SEPA direct debit collection in standard Microsoft Dynamics 365 Business Central runs through direct debit collections – a world of its own, separate from the rest of payment processing, with its own documents and its own handling. Incoming payments from direct debits only appear once the collection has been posted, and the processes around the collection – prenotification, mandate, returned direct debit – have to be handled manually.

With SEPA direct debit in the cash receipt journal you collect direct debits where you process incoming payments anyway: in the journal, with suggestion, prenotification, verification of payee and returned direct debit handling in the same flow.

Feature Description

A Cash Receipt Journal becomes a direct debit journal when its payment method is set up as Direct Debit or SEPA Collective Direct Debit. Only then are the additional fields and actions shown.

Additional fields on the journal line

Field	Meaning
Payer Bank Account	The payer's bank account that is debited. It is taken from the direct debit mandate, because a mandate authorizes the collection from one specific account.
Collection Date	The date the amount is collected from the payer. The bank needs a lead time in bank working days, so the collection date is not necessarily the posting date.
Message to Recipient	The purpose the payer sees on the account statement.
Verification of Payee (VoP) Status	Result of the check on the payer bank account.
Payment Status	Status of the journal line within the collection.
Prenotification Sent	Indicates whether the prenotification about amount and collection date has been sent.

Suggesting direct debits

The Suggest Direct Debits action creates journal lines for open customer entries. The call offers:

• Last Due Date – latest due date of the entries to be collected.
• Collection Date – if left empty, the date of every line is derived from the due date of the entry and the lead time the bank needs, on a bank working day.
• Partner Type – only customers of type Company (B2B direct debit) or Person (CORE direct debit). Empty collects both; they are submitted to the bank as separate direct debits.
• Only Invoices With Valid Mandate
• Summarize per Customer – one line per customer, mandate, collection date and currency.
• New Document No. per Line

Carrying out the collection

Carry Out Direct Debit and Carry Out Direct Debit and Post collect the direct debits for the journal lines – in the second case the journal is posted immediately afterwards. Lines of a collective direct debit receive a shared end-to-end reference.

The Verification of Payee (VoP) action verifies the account holder name and IBAN of the payer bank account. This plausibilizes the account and reduces returned direct debits.

Prenotification

Use the Print Prenotifications and Send Prenotifications actions – or Print/Send Prenotification for the selected line – to inform the payers about the amount and the collection date.

The framework for this is configured in the General Ledger Setup: Prenotification Nos., Prenotification Lead Time (Days) and Prenotification Mandatory.

Lead times and bank working days

So that the collection date is determined correctly, set the Base Calendar Code on the Bank Account along with the lead times CORE Direct Debit Lead Time (Days), First CORE Direct Debit Lead Time (Days) and B2B Direct Debit Lead Time (Days). Without a calendar the lead times are counted in calendar days.

Mandate and returned direct debit

The SEPA Direct Debit Mandate can be printed as a document and sent by email; the Direct Debit Mandate Validity is defined in the General Ledger Setup.

Follow-up handling for returned direct debits is configured there as well:

• Direct Debit Return Invoice Action – Do Nothing, Set On Hold (with Direct Debit Return On Hold Code) or Change Payment Method (with Direct Debit Return Payment Method Code).
• Direct Debit Return Fee Action – Manual or Reconciliation Rule or Charge Customer.

When a returned direct debit appears on the bank statement, assign it to the original collection in payment application through the Assign Returned Direct Debit action. When the journal is posted, the application of that collection is undone, the affected invoices are open again, and the returned amount settles the collection.

For more information, see Cash Receipt Journal.