Learn How to Set up a Direct Debit for Customers

The number of businesses leveraging Direct Debit systems for customer payments has grown exponentially over the last decade. As new consumer services, such as subscriptions, have become mainstream, Direct Debits are viewed as easy to set up for customers and as more reliable revenue streams for businesses. 

Recent data from Pay.UK, the company that runs the Bacs and Direct Debit payment systems, shows that annual Direct Debit payments were up by 14% for retail purchases, 6.3% for mobile telephone billing and  9.2% for general insurance bills at the end of 2023. 

Contents

• - Why Move Customers to Direct Debit Payments?
• - How to Set up Direct Debits for Customers.
• - What is the Difference Between a Bacs Approved Bureau and Direct Debit Facilities Management?
• - Interbacs Provides you with Enhanced Direct Debit Support. 
•  

Why Move Customers to Direct Debit Payments?

Your business may be using the same transaction systems you have had in place for years, or you might be just starting out. Whatever stage your business is in, inconsistent financial flows can be costly for organisations. 

Without a reliable and consistent payment process, your business could face challenges when it comes to fulfilling your obligations or achieving your growth objectives. 

Moving to Direct Debit payments means that you can encourage your customers to complete the Direct Debit Mandate form, which enables you to set up Direct Debits and collect your payments regularly. 

Customers also benefit from Direct Debit payments as they know how much they have to pay and this can support more secure budgeting. Customers can also feel reassured that they won’t have a period of service interruption if a bill has not been paid. 

Direct Debits can also support customers by enabling them to spread the cost of the product or service they have selected over time, easing financial pressures and creating financial transparency.

How to Set up Direct Debits for Customers

Setting up customers on Direct Debit payments is a quick and easy process. Firstly, customers have to complete a Direct Debit Mandate form or answer questions over the phone with a Bacs-approved paperless script. This is the evidence that the customer has approved the organisation of a Direct Debit payment from their account to your business. 

You can then share this information with your bank or Direct Debit facilities management service, and this payment will be set up and approved if all of the details are correct. Once the Direct Debit has been authorised, it typically takes three working days before becoming active. 

You will be given notice that the payment will be ‘live’ and the customer should receive a notification, usually over email, that their Direct Debit has been approved and will begin on the agreed date.

What is the Difference Between a Bacs Approved Bureau and Direct Debit Facilities Management?

Both a Bacs approved bureau and a Direct Debit facilities management service deal with Direct Debit payments. However, there are some differences between the two. 

A Bacs approved bureau is approved to submit payment instructions to the Bacs system for businesses. A bureau can also process Direct Credits for businesses. Additionally, a Bacs approved bureau can help a business to obtain their own SUN (Service User Number).

A DDFM (Direct Debit facilities management service) is offered by a Bacs approved bureau to allow businesses to use the bureau’s SUN to process Direct Debits, as they don’t have their own SUN. 

Put simply, a DDFM is a service provided by some Bacs approved bureaus as part of their broader service offering.

Interbacs Provides you with Enhanced Direct Debit Support

As an experienced Bacs approved bureau, our services are ideal if you have a SUN, or are applying for one, and would like to save time and money by removing the burden of internal processing tasks. 

One of the main advantages of working with us is that payments clear directly into your account. Plus, we assign a fully Bacs trained professional to your business, who will not only remove the stresses of the Direct Debit collection process, but will also provide ongoing training, advice and support. 

If your business doesn’t have a SUN, Interbacs’ Direct Debit Facilities Management service enables you to make Direct Debit collections. All of the administration and monitoring processes are managed by our professionally qualified Bacs processing team.

In addition, you can gain access to the benefits of Direct Debits, including your business name appearing on customer statements, without the administrative and financial burden of managing Bacs payments in-house.

Why not read our article about how to collect direct debit from customers?

With a proven track record in successful Direct Debit management for all types and sizes of businesses and with a compelling industry reputation, Interbacs are well positioned to support all of your business account needs.

Ready to make the switch? Contact Interbacs today for a personalised consultation and discover how we can optimise your direct debit processes.