Cash & Liquidity Management
Published  4 MIN READ
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Positive Impact on the Business Model

by Thomas Wolpert, Senior Credit Manager, UNION TANK Eckstein GmbH & Co. KG (UTA), and Jürgen Krieger, Sales Specialist Cash Management, Commerzbank AG

UNION TANK Eckstein GmbH & Co. KG (UTA) has operated as an all-round service provider for commercial goods and passenger transport for 50 years. UTA not only allows drivers to refuel at more than 32,000 independent diesel stations in 38 European countries and settle tolls in 20 European counties, but it also enables them to take advantage of breakdown, towing and repair services – and all of this is done without cash, using the UTA Service Card system. The use of direct debits is a fundamental part of UTA’s business model, which is why the company has been keeping a very close eye on the Single Euro Payments Area, particularly with regard to the SEPA B2B Direct Debit, right from the start.

The process that UTA used in the past was extremely complex and time-consuming, as direct debit collections abroad always had to be handled via the respective national schemes and their independent formats and processes – not to mention the fact that a separate bank account was required in each country. In view of that, the uniform B2B direct debit scheme across the entire SEPA area opens up brand new opportunities for UTA.

The SEPA rules provide for two different forms of direct debit: the SEPA Core Direct Debit, whose basic characteristics are similar to those of the German direct debit authorisation scheme, and the SEPA B2B Direct Debit, which is used solely for the collection of payments due from companies. The treasurers responsible for this area at UTA started off by finding out about the general requirements for utilising the new direct debit process, paying particular attention to the mandate and client communication process. All of the experience and results were documented in detail and saved in what is termed a SEPA process structure. SEPA Direct Debits must also be submitted to the bank with a given lead time and all submissions made through electronic channels. Finally, there must also be a signed mandate on hand from the payer. There are no formal requirements for this mandate, but its content has been expressly defined. It can be revoked by the payer at any time and automatically expires 36 months after it is last used.