The short and simple answer to this question is: yes. Any business that collects customer payments...
How does a business set up a Direct Debit Facility?
What is a Direct Debit?
A Direct Debit is a simple and convenient way for customers to pay their regular bills. Pay UK (previously known as the Bankers' Automated Clearing System) is responsible for the clearing and settlement of all UK-based automated Direct Debits. Direct Debits enable you to automate your payments. The upshot of which is that you receive ongoing payments at regular, defined intervals. That means less admin and lower overheads.
Direct Debit rules for business
Since the Direct Debit system of payment collection was introduced in 1968, businesses of all shapes and sizes have relied on Direct Debits as a simple, reliable and convenient way to collect money from their customers. If you’re looking for a predictable income stream during these unpredictable times, you might be wondering how to go about setting up a Direct Debit. There are several options available.
Depending on the size and needs of your business there are two main ways to submit Direct Debit payment files to Bacs – either as a direct or an indirect submitter.
Direct submitters, or Direct Debit originators as they’re also known, are normally larger businesses with a turnover of £1-10 million that process a large volume of Bacs transactions. These types of organisations are usually approved by Bacs and their sponsoring bank to manage the process of collecting and submitting Direct Debits.
Of course, that criteria makes it prohibitive for most small and medium-sized enterprises to even contemplate becoming direct submitters. In which case, the other way to go about things is to become an indirect submitter. This is where the set-up and ongoing management of Direct Debit processes are outsourced to a Bacs approved third-party expert, like Interbacs.
This is a great option for smaller businesses, start-ups, sole traders and charities that can't obtain their own six-digit Service User Number (SUN). It's also a convenient option for larger entities that do have a SUN but would rather not take on the administrative headache of processing Direct Debit payments in-house. For more details, check out our blog about what a Bacs Service User Number is and how it works.
Direct Debit for business solutions
Outsourced solutions for direct and indirect submitters differ slightly. Businesses that have a Service User Number typically use a Bacs Approved Bureau. Whereas, smaller businesses that don’t meet the criteria for a SUN tend to use a direct debit facilities management service. Both options allow you to set up Direct Debits for your customers quickly and conveniently – saving you time and money in the process.
One of the major benefits of using a Facilities Management Provider for small and medium-sized enterprises is that you'll be provided with your own SUN. This means that your company name and logo will appear on all your customer-facing Direct Debit documentation. This can have a positive impact on establishing the trust of new customers and maintaining their loyalty to the brand over the longer term.
The main difference between these two Direct Debit for business services is that a Bacs Approved Bureau service can collect and deposit funds directly into your bank on the same day. Whereas with a Facilities Management service, because your FM provider is acting on your behalf, the funds are initially held in a Client Trust Account and then transferred to your business account several days later.
Interbacs can get you started
Interbacs is a market-leading Bacs Approved Bureau and Facilities Management Provider. With more than 30 years of combined history of delivering bespoke Bacs solutions, we can help your business to set up and manage all your Direct Debit for business transactions. No matter how big or small your business is, our friendly and knowledgeable payment solutions experts are on hand to help you get started. Learn more about our solutions below and discover which ones suit your business best.
Get in touch with Interbacs
Save time and money with reliable, professional, and innovative payment solutions and services from Interbacs. For more information about any of our products or services, please contact us on 08444 127 180.