Comparison Table: GiroCode vs. SEPA Direct Debit
| Criterion | GiroCode | SEPA Direct Debit |
|---|---|---|
| Payment initiation | Payer (active) | Recipient (passive) |
| Mandate required | No | Yes (written) |
| Immediately usable | Yes | No (mandate needed) |
| Chargeback possible | No | Yes (up to 8 weeks) |
| Best for | One-time payments | Recurring payments |
| Cost | Free | €0.20–0.35 per collection |
When is GiroCode better?
- One-time invoices: Perfect for freelancers, tradespeople and businesses billing individually.
- New customers without a mandate: No lead time needed – GiroCode works without prior arrangement.
- Spontaneous payments: Donation drives, group orders or event fees.
When is direct debit better?
- Monthly subscriptions: Streaming, software licences or insurance – one mandate, then automatic.
- Club memberships: Regular, fixed amounts without effort for members.
- Recurring payments: Rent, instalments, monthly service fees.
Conclusion: GiroCode and direct debit complement each other. For one-time invoices, GiroCode is the faster, cheaper solution with no lead time. For recurring payments, direct debit provides automation convenience once the mandate is in place.
FAQ
What is the difference between GiroCode and SEPA direct debit?
GiroCode is a payment request – the payer actively transfers. SEPA direct debit is a debit authorisation – the recipient pulls the money. GiroCode requires no mandate and is immediately usable.
Do I need a SEPA mandate for GiroCode?
No. GiroCode requires no mandate since the payer actively transfers. SEPA direct debit requires a written authorisation (SEPA mandate) from the payer.
Can a SEPA direct debit be reversed?
Yes. SEPA direct debits can be reversed within 8 weeks without giving reasons. For unauthorised debits the period is up to 13 months. GiroCodes cannot be reversed as they are credit transfers.
How much does a SEPA direct debit cost compared to GiroCode?
SEPA direct debits cost the recipient €0.20–0.35 per collection depending on the bank. GiroCode is completely free for both parties.