A Direct Debit is an instruction between your customer and their bank, that authorises your business to collect payments from their account when they are due.
But let’s break that down a bit further and explain each step of the Direct Debit collection process:
Direct Debit Mandates
Direct Debit starts off with a Direct Debit mandate, or the Direct Debit setup process. This involves your customer completing a form, whether that’s paper based or online, where you collect some details from your customer to set up a Direct Debit. This includes their bank details, address, and the Direct Debit guarantee that your customer confirms they are happy with.
Direct Debit Collections
After your Direct Debit mandates are set up, we then help you with your Direct Debit collections and managing collection schedules. Whether you are collecting daily, weekly or monthly, collecting a variable amount each time, or need to include several one-off payments, it’s all within your control and managed through our Direct Debit portal.
Monitoring and reporting
Once you’ve collected your payments, you’ll need to understand the funds you’ve collected and how much you’re receiving, when it’s coming into your account, and which customers make up those funds. This is where you can use our Direct Debit software’s built-in monitoring and reporting tools, that will help you manage your payment data.
The next step is to do some reconciliation, where you can use our integrations with Quickbooks and Xero to reconcile your Direct Debit collections with the invoices in the system. Or you can use a manual approach, where you log into our Direct Debit software, export some reports and compare those with customer reference numbers to balance your collections with your books.
Keeping Bacs compliant
The final part of our Direct Debit service is to keep you Bacs compliant throughout the Direct Debit process. There are some rules you must follow in order to collect Direct Debits, including sending Advance Notices and Welcome Letters, and our Direct Debit software helps by sending these out automatically on your behalf. We also offer training and great customer service to make sure you’re always up to date.
Collect recurring payments with London and Zurich
London and Zurich help SMEs and enterprises collect recurring payments via Direct Debit. With robust technology, great customer service, and a competitive price, we have made Direct Debit collections accessible to hundreds of businesses across the UK.