What is a Direct Debit Management System?

Like all payment methods, Direct Debits work best when they are organised and maintained through a transparent and efficient system. If your business doesn’t have a strategic approach to transaction collection, then it’s likely you won’t be able to consistently and reliably forecast future cash flow. 

One way that optimises the advantages Direct Debits can bring to enterprises is by operating with a Direct Debit management system. What are Direct Debit managed services? 

Put simply, a Direct Debit management system is a process that arranges and oversees the entire Direct Debit lifecycle, from the customer instruction right through to payment completion. Many Direct Debit management system providers use Direct Debit management software or DDMS to automate Direct Debit collection for increased accuracy. 

In a recent UK consumer survey, 57% reported that Direct Debit is their most common online payment type, second only to debit cards. Furthermore, Direct Debit volumes rose by 2.2% to 4.8 trillion payments last year. 

Consumers are comfortable with using Direct Debits as a quick and easy way to pay for goods and services, so businesses looking to grow their customer base may want to offer Direct Debit payment services as a convenient payment option. 

Contents

• What is a Direct Debit management system?
• How does Direct Debit management software work?
• Achieve more with DDMS and Interbacs. 
•  

What is a Direct Debit management system?

In essence, a Direct Debit management system (DDMS) is the overall framework that supports the collection, collation and completion of Direct Debit transactions. This type of system enables you to manage payments, handle customer data, meet compliance regulations, and analyse Direct Debit reporting. 

Without a coherent and resilient systematic method of collecting Direct Debits and storing related information, the ability to analyse for valuable insights is much harder for businesses. 

One Direct Debit agreed by a customer is easy to manage, but when your business is dealing with hundreds of Direct Debits a month, automation and accuracy are key to ensuring only the correct payments are taken at the right time. 

Automation through a Direct Debit management system reduces payment errors, such as trying to collect a payment that has been cancelled by the customer or using incorrect customer information or banking details, which can hinder payment collection. 

Partnering with a Direct Debit service provider and using a supportive Direct Debit management system means that organisations have access to a whole range of Direct Debit reports, such as the ARUDD (Automated Return of Unpaid Direct Debits) report to help manage any failed payments. 

Your business will also have access to the ADDACS (Automated Direct Debit Amendment and Cancellation Service) report. This informs your teams about which Direct Debits have had a payment amount or payment date altered and if any have been cancelled by the customer. This also helps minimise any payment collection errors. 

If a customer believes a direct debit payment has been made in error, and their Payment Service Provider (bank) agrees, a Direct Debit Indemnity Claim (DDIS) will be raised. A Direct Debit Management System will track these, too, as well as any claims that are cancelled following a successful challenge from the Service User.

How does Direct Debit management software work?

If a Direct Debit management service is the framework for Direct Debit payments, then Direct Debit management software is the engine fuelling the whole process. In a nutshell, this software facilitates and tracks Direct Debit payments. 

Each step of the payment process is mapped and managed, such as customer authorisation, payment completion and reconciliation. Plus, you can speed up processing time with automation, due to the fact that payments are scheduled ahead of time which cuts down administrative tasks. 

If you’re using Direct Debit management software supplied by a trusted and experienced Direct Debit service provider, then you can expect the software to integrate efficiently with accounting and internal systems. 

This is the case with DDMS from Interbacs, a full Direct Debit suite which makes it easy to edit, cancel and arrange new Direct Debits, with the same applying to regular credits, too.

Achieve more with DDMS and Interbacs

Without a clearer picture of your financial landscape, it can be challenging to shape objectives and plan strategically for the near and longer term. Building your business with reliable payment collection options supports growth plans and helps you scale at your own pace.

With Interbacs, you can gain access to a tailored Direct Debit management system that uses highly configurable software moulded to your business needs. Thanks to its integration with InterPay, you can manage and submit the Direct Debits from within the same system. You’ll also enjoy access to automated email facilities, enabling you to eliminate manual customer notifications.

Compliance is of the highest importance. You’ll be reassured to find that our DDMS ensures all bank account data is validated and passes Bacs rules to maintain your eligibility to receive Direct Debits.

With a proven track record in successful Direct Debit management for UK businesses and a renowned industry reputation, Interbacs are expertly 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.