A direct debit collection is one payment taken by a business, known as the originator or creditor, from a customer's bank account under a direct debit arrangement. Before collecting, the business must hold a valid mandate authorising it to debit the account. It then submits each collection, with the amount and due date, through its bank or a payment provider to the relevant scheme, such as Bacs in the UK, SEPA Direct Debit in the euro area or the ACH network in the United States, where the equivalent is an ACH debit.
Schemes usually require advance notice to the payer of the amount and date. On the due date the payer's bank debits the account and the funds settle to the business. Collections can fail, for example for insufficient funds or a cancelled mandate, producing a direct debit return, and payers may claim refunds within scheme time limits.