The term ‘Bacs payment’ may not be commonly used in your business or by your accounting team. Yet many organisations regularly use Bacs payment services to collect customer payments or to make bill or salary remittances.
In fact, Bacs industry-to-industry payments in Q3 of 2024 were 67% higher than Q3 of 2017, illustrating their growth in popularity with businesses across all sectors.
According to Pay.UK, the value in millions of both Direct Debit and Direct Credit payments in the UK rose by 4% from December 2023 to December 2024, compared with the previous 12 month period.
Plus, the value in millions for both Direct Debit and Direct Credit payments in the UK rose by 4% in the 12 months to December 2024.
Organisations that have been using Bacs payments for incoming and outgoing financial flows know that the Bacs system is efficient, reliable and consistent. Customers can set up Direct Debit payments or receive Direct Credits into their accounts easily with a proven level of transparency.
It’s only when you’re faced with certain situations, such as delayed or misplaced Bacs payments, that you might need to know more about the inner workings of the Bacs system to help resolve or clarify any issues.
Contents
- Who uses Bacs payments?
- Why would a Bacs payment be delayed?
- What to do if a Bacs payment is delayed.
- Efficient Bacs payment services with Interbacs.
Who uses Bacs payments?
Notably, most of the highly-recognised and well-known UK high street banks use the Bacs payment system, including the Bank of England. Many financial institutions, ranging from charities to the UK Government, also make and receive payments through Bacs to other businesses and individuals.
These organisations are likely to work with Bacs for a range of different payment purposes. For example, charities can receive donations through Direct Debits, or the government can pay their employees’ salaries directly through Direct Credit.
In an enterprise supply chain, suppliers can be paid for their goods or clients can pay bills for services through Bacs payments. In addition, customers who want to use a service or buy a product can set up a Direct Debit to pay at regular intervals or with a one-off payment.
Why would a Bacs payment be delayed?
Payment delays can be both frustrating and confusing for customers and businesses alike. There may be a lack of clarity around why a Bacs payment is delayed. A factor behind any potential delay could be the three day processing cycle for Bacs payments, which only happens on working days.
This means that payments that commence on a bank holiday or weekend won’t be processed until the next working day. So, if a Direct Credit payment was supposed to occur on a bank holiday Monday, it’s likely that it will take place instead on the next working day, which would be the Tuesday of that week.
Delays in Bacs payments could also be caused by:
Insufficient funds
A Bacs payment could be delayed or stopped temporarily if there isn’t enough money to cover the amount of the payment in the payee’s bank account. This could be resolved quite quickly if funds are paid into the account to cover the Bacs payment, so it can go ahead.
Incorrect payment details
Any inaccurate payment information, such as the recipient’s name or account number being incorrect, could cause a delay in a Bacs payment. If the correct details can be submitted in time, completion of the payment may not take too long.
Technical issues
The Bacs system and network of banks involved rarely have serious technical problems that delay payments over an extended period. However, a small technical issue inside the system or the banks themselves may affect Bacs payments from time to time.
Validation checks
Verification of payee and recipient information and bank account details will take place for every Bacs payment. Bacs rules state that businesses setting up a Direct Debit for a customer must verify the customer’s bank account information, identity and address. Validation checks may delay a Bacs payment as these must be completed before a transaction can take place.
Efficient Bacs payment services with Interbacs
You may be wondering: can a Bacs payment be stopped or can Bacs payments be recalled? It’s tricky to find the answers to all of your payment questions if you don’t know where to turn.
At Interbacs, we have years of Bacs payment services experience at our fingertips. We’re here to answer your payment questions. Plus, we offer a wide range of fully customised Bacs payment services that tailor to your exact business needs.
Take the hassle out of managing payments and let our experts handle it for you. Contact Interbacs today for a personalised consultation and unlock a more efficient, secure, and scalable payment solution.
