How long does an active mandate last?

A mandate is an authorization that a user gives to a lender to automatically debit their account for loan repayments. This comes in the form of direct debit mandate, where the user consents to have funds deducted from their account on agreed dates. An active mandate means that this authorization is currently valid and in effect, allowing scheduled debits to take place without the user having to manually initiate each transaction. These mandates can be configured to remain valid for as long as the user specifies or as set by the lender.

One of the key benefits of an active mandate is that it simplifies and automates the repayment process, reducing the risk of missed payments and penalties. It also supports financial discipline, as users are less likely to spend funds meant for repayment. From the lender’s perspective, active mandates provide a more predictable cash flow and improve recovery rates.

For example, you can give out a 12-month loan and setting up a mandate that allows monthly deductions on the 25th of every month. As long as the mandate remains active, you can debit the user’s account automatically on those dates. This flexibility makes active mandates a convenient and efficient tool for both borrowers and lenders.

Find out how to view direct debit mandates on your admin console here

Also read: You can now activate your direct debit mandates in 1 minute