SEPA Creditor Identifier

A Single Euro Payments Area Creditor Identifier or SEPA Creditor Id is a standardized and unchanging identification number that serves to unequivocally identify a creditor across Europe. SEPA Creditor identifier is used to collect SEPA direct debit and allows both debtors and its banks to turn to creditors in case of claims for reimbursement or complaints.

A SEPA Creditor Identifier is a requirement to enter into a SEPA Direct Debit agreement. It is important to keep in mind that while each creditor can use more than one SEPA Creditor Identifier, each of them is unique and can be used for the initiation of collections throughout the SEPA financial institutions.

For a creditor to collect a SEPA direct debit, it must make use of its Creditor Identifier, which along with the SEPA direct debit mandate reference is forwarded to the debtor. Such a process allows the debtor to be able to check the actual existence of the mandate or at least that its bank be capable of optionally providing him with that service.

The length of the SEPA Creditor Id differs by country but it will never exceed 35 characters. However, its structure has been standardized as follows:

• Digits 1-2: ISO Country Code.
• Digits 3-4: Check Digits (it comprises 2 characters).
• Digits 5-7: Creditor Business Code (it works as an indication of the different business areas inside the creditor’s business).
• Digits 8-28: National Identifier (its length varies, but it does not go over 28 characters. Likewise, its characters are numbered in successive ascending order).

Example:

*Some countries such as Austria and Luxembourg have a fixed value at the beginning of the National identifier, e.g. 0

Applying for a SEPA Creditor Id is generally only possible in electronic form and through a financial institution. Direct debit creditors may be located in any SEPA country. Yet, creditors should apply for a SEPA Creditor Id in the country they have their main residence or main office. In other words, the Id is usually granted at a legal entity level, within the country of constitution of the legal entity. Hence, the process and the time to obtain an identifier vary from country to country.

Only in exceptional cases an Id will be assigned to creditor banks if they are located outside of the issuing country; the condition is that the creditor has to be located in the country issuing the Id.

Although having an SEPA creditor Id is a prerequisite to collect a SEPA direct debit, authorization to collect it is not granted by the assignation of an Identifier; it is the financial institution that holds the creditor’s account the one that has the last word in this matter.

It is important to take into consideration that in case the creditor’s information details suffer any changes (e.g. change of name, address, legal form, etc.) there will be no need to apply for a new Creditor Identifier. Even in the case that the creditor switches its bank account the former applies. However, if requested by its financial institution the creditor does have to provide evidence that shows that despite the changes his identity remains the same.