Businesses in the UK that need to collect payments from their customers aim to find the safest and most reliable payment method available. According to recent data, Direct Debit was the second most common online payment type in the UK in June 2024. The statistics show that 57% of online payments were made via Direct Debit, highlighting that UK businesses and consumers trust Direct Debit as a secure and dependable payment option.
This data confirms that Direct Debit is trusted by organisations and consumers alike because it is easy to set up, simple to amend, and safe to use. As a result, Direct Debit helps businesses collect payments efficiently, while customers benefit from convenience and transparency in their transactions.
Learning how to collect Direct Debits from customers allows businesses to establish predictable cash flow, improve financial stability, and optimise their payment management systems.
Learning how to collect Direct Debits from customers allows businesses to establish predictable cash flow, improve financial stability, and optimise their payment management systems.
Contents
- What is a Direct Debit payment?
- Is Direct Debit safe?
- How to collect Direct Debits from customers.
- Secure Direct Debit collection with Interbacs.
What is a Direct Debit payment?
A Direct Debit, also known as a Bacs Direct Debit, is a financial transaction between a business and a customer. In this arrangement, a customer gives consent to a business to collect a previously agreed payment amount directly from their bank account. This process ensures that the business receives payments securely, while the customer maintains control through prior authorisation.
For this transaction to occur, the customer must complete a Direct Debit mandate form, which authorises the payment once the customer’s details are validated. The mandate form, sometimes called a Direct Debit instruction form, acts as the customer’s official permission for recurring payments. Customers can submit this form by phone, online, or in writing, depending on what the business allows.
Once the customer submits the Direct Debit mandate form, the business sends the payment instruction to the customer’s bank or building society. This ensures that all parties are informed of the payment schedule, start date, and amount. Understanding how to collect Direct Debits correctly is therefore essential for businesses to maintain clear communication and compliance with all stakeholders.
Is Direct Debit safe?
Some customers may feel concerned about sharing personal data online or over the phone, fearing that any payment process, including Direct Debit, could pose security risks. However, Direct Debit is recognised as a secure payment method because it operates under the protection of the Direct Debit Guarantee.
This Direct Debit Guarantee is provided by UK banks and ensures that every organisation collecting payments via Direct Debit is vetted and approved before handling customer funds. This means banks verify businesses before allowing them to process Direct Debit transactions, which gives customers confidence that their payments are protected and recoverable in the event of an error.
In addition, the transparent process of how businesses collect Direct Debits helps build trust between organisations and their customers. When businesses follow verified collection procedures, the system functions more reliably, and customers gain reassurance in the safety and consistency of Direct Debit payments.
How to collect Direct Debits from customers
Fortunately, learning how to collect Direct Debits from customers is a straightforward process for most organisations. In practice, a business can collect Direct Debit payments in two primary ways, depending on how its payment system is set up.
Essentially, an organisation chooses a method to collect payments either with a service user number or without.
How to collect Direct Debits with a SUN
A Service User Number (SUN) is issued by a sponsoring bank and enables a business to collect Direct Debit payments directly from customers. In simple terms, the SUN acts as a unique identifier that links a business to its Direct Debit transactions, allowing payments to be processed securely through the Bacs payment network.
While Direct Debit payments are simple for customers to authorise and use, many businesses find that managing the administrative setup can be time-consuming. The process of obtaining and using a SUN often requires staff time, technical knowledge, and compliance checks, which can strain smaller teams.
If a business wants to collect Direct Debits but lacks the time or capacity to handle these transactions, a Bacs Approved Bureau such as Interbacs can manage the process on its behalf. Interbacs, as a Bacs Approved Bureau, acts as an intermediary between the business and the bank, ensuring that payments are collected, processed, and cleared securely.
By using the Interbacs Bacs Bureau Service, businesses reduce internal processing workloads, save time and money, and ensure that all Direct Debit payments are transferred directly into their bank accounts. This means companies no longer need a large payment team, as Interbacs efficiently handles the entire Direct Debit process, reducing stress and improving payment accuracy.
How to collect Direct Debits without a SUN
For many businesses, especially SMEs and new organisations, obtaining a Service User Number (SUN) from a bank or sponsoring institution can be challenging. However, a Direct Debit Facilities Management Service allows businesses without a SUN to collect Direct Debit payments securely and compliantly. This means a business can still access Direct Debit functionality even if it has not been approved for its own SUN.
Through a Facilities Management Service, such as the Interbacs Direct Debit Facilities Management Service, the provider manages all administrative, technical, and monitoring processes on behalf of the business. In doing so, Interbacs acts as an authorised intermediary that handles the setup, validation, and ongoing management of Direct Debit transactions under its own approved SUN.
By using this service, your business gains the advantages of Direct Debit payments, including your company name appearing on customer bank statements, without the need to handle Bacs processing internally. As a result, businesses benefit from expert Bacs support, reduced administrative burden, and improved efficiency in managing recurring payments.
Secure Direct Debit collection with Interbacs
Reassuring, robust and reliable, our Direct Debit services empower businesses of all types and sizes to collect Direct Debit payments and create a consistent financial flow without the need to complete all of the paperwork on a regular basis.
Boosting customer trust and enhancing your brand reputation, our Direct Debit services are ideal to help your business grow and scale at the pace that’s right for you and your 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.
