Debit orders in South Africa are considered as electronic funds transfers (EFT’s) and are governed by, amongst other documents, Bankservs’ manual for the processing of EFTs. This manual sets out various requirements for the valid processing of a debit order and all the major banks are contractually bound to abide by this manual. Written authorization is required, however, interestingly enough and contrary to popular belief, a signature is NOT a requirement and written authorization for a debit order can be electronic.
Legally an electronic authorization for a debit order should be accepted. The requirements for an authorization are that it needs to be in writing and in terms of the Electronic Communications and Transactions Act writing can be an electronic data message, for example an online form or email. Your problem comes in with the parties involved in administering a debit order. The Payments Authority of South Africa manages interbank payments, payment processing, clearing and settlement within the national payment system. It was set up to manage all aspects of payment processing under mandate from the Reserve Bank. Bankserv, was in turn appointed by PASA to do the payment switching between banks who are members of PASA, namely all of the major banks.
Although it appears that from a legislative and a contractual perspective electronic authorization is allowed, there are practical impediments in that basically the banks and PASA seem to like only paper or telephonic recorded authorizations (which have their own issues in terms of system costs and set up). The end point is the sponsoring bank and the control they have over this debit order process. Ultimately they will be the gatekeeper as you need a sponsoring bank in order to start accepting payments by debit order. My advice would be to talk to your bank and get their view on accepting electronic debit order authorizations. Ultimately they will be the ones deciding to reverse payment or not from an irregularly authorized debit order instruction.