The South African Reserve Bank will introduce the Authenticated Collections (AC)/DebiCheck project from tomorrow, 1 May 2021 as part of its modernisation of the National Payment System.
This project seeks to address the increasing levels of abuse in the debit order payment system, known as the early debit order (EDO) payment system.
According to the Bank, all new and renegotiated EDO mandates will now be originated in the AC/DebiCheck payment system from next month and not in the current EDO payment system.
“Early debit orders will only be processed through the AC/DebiCheck payment system, while normal debit orders will still be processed later in the day as per current arrangements. Before then, consumers would provide a mandate to a company or user to collect money from their bank account.
“In the new AC/DebiCheck payment system, consumers will provide authorisation to their bank, by way of an authenticated mandate, to release the funds from their account when a debit order is submitted by a company or user from whom they bought goods or contracted for a service,” said the Reserve Bank.
Companies or users of the system had until 1 November 2019 to fully implement the AC/DebiCheck payment system.
“Owing to the complex nature of the AC/DebiCheck system, a lengthy ramp-up period was required to ensure that all stakeholders in the EDO collections ecosystem had implemented and tested their internal processes and interfaces to the AC/DebiCheck payment system,” the Bank said.
It said the project is an initiative of the collections industry, which ensures the safety and efficiency of the National Payment System, and the mitigation of rogue and fraudulent behaviour in the collections system.