How do you get started with Direct Debit?

If you have decided that you want to take Direct Debit payments from your customers, you’ll need to make a few key decisions to set it up.

Get in touch with your bank

If you are going to take Direct Debit payments directly your bank will be your ‘sponsor’. This means they will need to do some in-depth checks to make sure you can follow the rules of the scheme, especially the Direct Debit Guarantee which is strictly enforced.

Find out everything you need to know about the Direct Debit Guarantee here.

Using Bacs

Direct Debit is a type of Bacs payment. If you’re not sure what Bacs payments are, it’s explained in our guide here.

You can submit payment information to Bacs directly by setting up your own Service User Number (SUN). In reality, this is usually only possible for large and well-established companies.

However, smaller businesses or companies that only take a limited number of Direct Debit payments, can use a SUN through a ‘bureau’ who will manage the process on your behalf for a commission fee.

Find out more about SUNs and your options for using them to take Direct Debit payments here.

Get your customers on board

When you have access to a SUN, you’ll need to get your customers to sign up.

This is done by getting them to complete a ‘mandate’ or instruction to their bank authorising you to take Direct Debit payments, either with a paper form or online.

If you are using a third party to manage your Direct Debit payments, they may offer additional services to make this even easier.

When payments are taken, the data is sorted as to which bank it is going to, then transmitted to them to be credited into your account, at the same time as it is debited from your customers’ accounts.

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