The Paper Based System
Ever since the introduction of AUDDIS (Automated Direct
Debit Instruction Service) in 2005, all communications
between Direct Debit Originators and BACS are carried
out electronically via a secure online network.
 Despite this, the majority of businesses and organisations
continue to receive signed Direct Debit instructions from
their customers on a paper
mandate. However, the
paper instructions are
retained at your premises
instead of being sent to
the banks and building
societies. Once customer
instructions have been
recorded on your
organisation’s computer
records, the data can be sent to the paying banks via
FastPay to enable them to record the authority in their
own customer Direct Debit records.
You will then send Direct Debit payment requests
electronically via FastPay to BACS who in turn will send
those instructions onto the paying banks. Payments are
collected automatically by BACS and if, for any reason, the
payer is unable to honour that payment, the payer’s bank
will request a refund from BACS who will forward the
request to FastPay. The refund is expected within 3 days.
Should one of your customers query a payment or
instruction with their bankers, their bank may request a
copy of the paper instruction held by you. You will have to
provide a copy of the instruction to the bank within seven
working days. If you store Direct Debit Instructions
digitally, the bank will normally accept a copy of the
original instruction bearing the customer’s signature.
Being in possession of a signed instruction puts you, the
Originator, in a very secure position in the event of any
dispute. This is the reason why, even in today’s world of
electronic communication, the banks favour the security
of the paper based method over Paperless Direct Debit. |
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Paperless Direct Debit
In a world where shops and financial services offer
24-hour access and instant responses, relying on
paper-based Direct Debit processing is not providing the
sort of service people want and expect.
 Paperless Direct Debit offers customers immediacy and
simplicity, and provides organisations with reduced
processing costs and greater efficiency. It allows new
customers and donors
to move through the
decision-making
process to the moment
of sign-up seamlessly
and quickly. With
Paperless Direct Debit,
once someone has
visited your website
and decided they want to purchase your product or
subscribe to your services, they can sign up immediately
and you can begin to process that request.
Paperless Direct Debit enables organisations to sign up
customers for Direct Debit collections over the telephone,
Internet, touch-tone technology or via interactive TV.
Here are some of the benefits of Paperless Direct Debit:
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Substantially reduce the paperwork, delay and
postage costs associated with Direct Debit; |
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Convenient, safe and popular with customers resulting
in increased sales. Companies using Paperless Direct
Debit have reported an increase in sales of over 25%
when compared with Paper Instructions; |
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You can begin the collection process earlier, as there is
no need to wait for the customer to complete and
return the Direct Debit Instruction; |
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Direct Debit is less expensive and more flexible than
credit card payments, especially for recurring fees; |
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By allowing your customers to sign up online, you will
be offering an improved quality of service to your
customers in line with many large organisations that
already offer this service. |
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