According to data from the Bank of Spain, direct debits accounted for 12.8% of the total transactions (excluding cash payments) in the second half of 2023. A bank receipt (recibo bancario) is required to process this type of operation, and it is one of the most common documents in regular money transactions between banking entities. Bankinter indicates that these records are involved in 45% of operations in Spain. Let’s explore what roles these documents play in the movement of funds and how to manage them in your company.

What’s in this article?

• What are bank receipts?
  
• How are bank receipts issued?
  
• What advantages do bank receipts provide?
  
• Return of bank receipts
  
• Frequently asked questions about bank receipts
  

What are bank receipts?

Bank receipts are documents generated after signing a SEPA mandate with a customer and must be stored for as long as that business relationship is maintained. These receipts are prepared by the payee (sometimes also referred to as “beneficiaries”), that is, the party initiating the charge. Subsequently, when the financial institution provides the collection order, the funds are withdrawn from the debtor’s account. Although it is true that the term “bank receipts” is also used for payment receipts issued by banks after the transaction has been completed, in this article, we will focus on the most relevant meaning for companies: the charge requests mentioned above.

Such documents authorize the banking entities to retrieve the sum from the client’s account. In Spain, this is very useful in two cases: a one-off charge or to periodically pay an amount to a company that provides a service or sells a product with a subscription-based business model.

How are bank receipts issued?

The process of issuing and retrieving these documents can be explained in three phases:

Signature of bank receipt

The debtor party must sign a SEPA mandate governed by Regulation (EU) No. 260/2012 of the European Parliament and the Council of the European Union. The charge cannot be processed if the debtor party does not sign this mandate. Without it, SEPA Direct Debit cannot proceed, as the collector will not be authorized to withdraw the indicated sum from the client’s account. This authorization can only occur if the command contains all of the following information:

• SEPA mandate single reference
  
• Name, address, and IBAN of the debtor party
  
• Name, identifier, and signature of the beneficiary party
  
• Signature date
  
• Transaction type
  

Issuance of bank receipt

After receiving the client’s authorization, the record justifying the amount owed is prepared. The information related to the product sold or service offered to the payer must be detailed to do this.

Collection of bank receipt

Many companies issue a remittance, a document that instructs the financial institution to manage a series of collections, ensuring the record is processed. These remittances must include the information found in the bank receipt in an XML file that meets the ISO 20022 standard. If it is a recurring payment, it must be sent periodically to the institution. After the scheduled date indicated on the remittance arrives, the bank withdraws the money from the debtor’s account and deposits it into that of the creditor company.

What advantages do bank receipts provide?

Using these records for recurring charges has certain benefits over other payment methods. Let’s look at some of the most important ones:

• Cash flow management: By agreeing in advance with your clients on the collection date, you can better plan the inflows of money.
  
• Reduction of rejected payments: Connecting directly to your customer’s account significantly reduces the chances of payment not being made, as could occur, for example, when a credit card expires.
  
• Security: Relying on such documents brings greater security to the business, given it has signed an initial agreement with the client through the SEPA mandate. Similarly, bank receipts are safer for customers because by requiring an initial signature ensures they won’t receive unexpected charges.
  

Working with a payment processor that maintains close relationships with financial networks and banking partners, such as Stripe Payments, is very helpful in simplifying the collection process. Integrating this platform into your technology stack allows you to accept over 100 payment methods from customers in over 195 countries, including SEPA Direct Debits. Additionally, Stripe ensures that all your payment processes comply with local regulations. With Stripe Billing, you can also automate your clients’ recurring charges and avoid manual tasks to request funds from banks.

Return of bank receipts

Debtors can request the return of bank receipts by contacting their financial institution, although this process can exclusively be carried out in two cases:

• The client did not authorize the charge: If the client sees a debit on their account that was never approved, they can contact their institution within 13 months of receiving the bank receipt.

• The beneficiary was not transparent about the sum: Regardless if the customer had authorized the bank debit, they can still request a refund within eight weeks if they can show that the beneficiary did not specify the amount and that, after several similar charges, a significantly higher total was applied.

To cancel a direct debit before the next charge occurs, the customer must provide to the bank a signed document stating the date of the request. The document will only be accepted if delivered no later than one business day before the scheduled payment.

If the client requests the return of the record, the bank has 10 business days to proceed with a full refund of the amount collected or reject the request, clearly indicating the reason and the existing mechanisms to dispute that decision.

Frequently asked questions about bank receipts

What are the differences between bank receipts and invoices?

Bank receipts are collection authorizations, while invoices are payment obligations. Sometimes, the invoice number is included on these forms to clarify the origin of the sum owed.

Are bank receipts the same as direct debits?

No. Direct debits are arrangements that the payer provides for periodic, automatic charges from their account. In contrast, bank receipts are the documents that validate each of these fees.