[ARCHIVE] Definition of Financial Institution

Archived 2022.12.11. Content moved to Guidance on direct debits 

Question

Is the definition of financial institution in the scopes for Banking Authorised Party: 

• Option A: the financial institution which the merchant/Authorised entity banks with OR
• Option B: where the direct debit is being processed (i.e. the data holder)

In the event of option (b) - a third party supplier (e.g. company A) who uses another financial institution (e.g company B) to process Direct Entry files. In this scenario what should a Data Holder populate in this field?

Answer

It should be (a) the financial institution of the merchant requesting the funds from the customer's data holder via the direct debit authorisation. This is the sponsoring financial institution of the merchant as a debit user in BECS.