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Direct Debit services for small businesses: Everything you should know

When Direct Debit was first introduced in the UK in the 1960s, it was an expensive, time-consuming process made available only to big businesses.

However, as time has progressed and thanks to the digital age, Direct Debit has become accessible to companies of all sizes. Direct Debit services for small businesses mean many can reap the benefits of offering their clients and customers a quick and easy way to pay securely.



Direct Debit: How does it help businesses?

As the world becomes more digital, it’s becoming a necessity for companies to offer a way for their customers to pay online — mobile payments alone are used by over two billion people globally. Direct Debits are a fast and secure way for companies to take hassle-free payments from their customers.

As the process is automatic and instant, Direct Debits can ensure a steady cash flow for your business to facilitate growth and save you precious time.

Thanks to Direct Debit services, companies of all sizes can now enjoy the benefits of accepting Direct Debit payments.



The benefits of Direct Debit services

There are many benefits that small businesses can enjoy by adopting a Direct Debit service. Let’s explore some of them.


Reduced admin time

Direct Debit payments eliminate the need for any billing paperwork, significantly reducing your admin time. The need for manual input during any part of the payment cycle is also considerably reduced, meaning you spend less time punching numbers into your system.

Plus, once the Direct Debit has been set up with your customer, it needs minimal administration unless any changes are essential. The pre-agreed sum is taken on a pre-agreed date, so you can enjoy the benefits of a steady and expected cash flow to grow your business.

Failed payments with a Direct Debit service are also a rarity, so you can forecast how much money will reach your business and when.


Greater business efficiency

Constantly chasing customers or clients for late payments or invoices can take precious time away from your business day. Customers often lead busy lives and contacting them can sometimes be challenging, leading you to a time-consuming chase for your money.

After setting up Direct Debits for your business, payments are automatic and recurring, meaning no more chasing late payments.

The time you save not seeking out late payments can be invested back into growing your business.


Improved processes

Direct Debit payments automation allows you to take full advantage of the digital age and cut costs for your business.

By cutting down your financial administration time, staff requirements for chasing payments will be decreased. This may open up the opportunity to merge roles or invest time in other areas.

You’ll also be able to cut costs for the postal charges, stationery or phone bills you’d use to track down payments.

Plus, on the rare occasion a payment does fail, it can be automatically recollected or recovered using alternative methods. Reporting tools monitor all payments and ensure no payment fails slip through the cracks, improving your service as a result.


Ensured steady cash flow

Cash flow is one of the most important aspects of growing any business.

With a Direct Debit service, you’ll know when each specific amount will reach your account, opening up the opportunity for clearer growth planning.

You’ll have a wider overview of your budget, meaning you can allocate funds to growing your business while being safe in the knowledge that you have enough cash remaining for your company’s essentials.


Added customer trust

Thanks to the Direct Debit guarantee, each Direct Debit payment made by your customers is protected.

In the rare event of an error, the customer is entitled to a full and immediate refund of the amount taken. 

By advertising that your business accepts Direct Debit payments, potential customers can trust that they're entitled to a full refund as per the scheme rules, should an error ever occur.

Plus, with a Direct Debit service, your company's name will appear on your customers' bank statements, leaving no doubt about where their money has gone. This can lead to fewer customer queries and cancellations.

Customers can also cancel a Direct Debit at any time through the business or their bank, giving them total control over their payments.

Learn more about our Direct Debit Facilities Management service

If you're interested in enjoying the benefits of Direct Debits without the setup or management administration, Direct Debit Facilities Management might be something your business should consider.

We know how difficult it can be for SMEs to achieve Direct Debit status, but with Direct Debit Facilities Management, you can reap the benefits without managing it yourself.

Are you interested in this service for your business? Our infographic explains everything you need to know about the service in a matter of minutes. Click below to get your free copy.

direct debit facilities management infographic