Frequently Asked Questions

A Direct Debit is an instruction from a customer to their bank or building society authorising an organisation to collect varying financial amounts from their account.

As with most things in life there are a number of options, your bank is usually the best place to start. You can apply to collect Direct Debits directly or you may choose to involve a third party to help you. It will depend on your business and your customers as to what works best for you. We can help with Direct Debit collections, please contact us for more details.

The Direct Debit Instruction (DDI) is the method by which Service Users obtain a Payer’s authority to debit their bank account. The design of each Direct Debit Instruction template must be approved in writing by the Service User’s sponsoring bank before the DDIs can be issued to customers.

The rules say “a copy” of the Direct Debit Instruction will be sufficient and so a scanned copy is all that is required should you ever need to produce one for a paying bank.

This is located in the secure area of the Bacs website. You will need your password and login details to access it. If you do not currently have a login, then you can request one from Bacs and you should be given access provided you are a registered Service User.

If the payer has cancelled the DIrect Debit by mistake then they can re-instate the Direct Debit, they just need to get in touch with their bank to authorise the re-instatement. Once this has happened you will usually be notified of this with a reason code R on your ADDACS report. You may re-instate a cancelled Direct Debit Instruction up to two months from cancellation. This means that you may resume Direct Debiting under the re-instated instruction, however a new DDI must be obtained and lodged if the re-instatement is identified after the two-month period.

If a payer cancels a Direct Debit with their bank you will receive notification on an ADDACS report (Automated Amendment & Cancellation report). Service users must cancel the Direct Debit on their CRM and then liaise with the payer to agree the payment method for the collection of any outstanding balance. Remember, the ability to cancel is a vital part of the Direct Debit Guarantee which supports customer confidence in the Direct Debit scheme.

AUDDIS is the Automated Direct Debit Instruction Service – it’s the easiest and quickest way to set up a new Direct Debit customer. For all companies looking to collect by Direct Debit for the first time, this is now the mandatory way to send your Direct Debit Instructions to Bacs unless you are using a 3rd party to make your collections.

It is only mandatory for any new Service Users that are submitting directly to Bacs. It is not mandatory if you are using a 3rd party to make your collections or are already a Service User. This is something that gets discussed frequently and may happen in the future, however at the moment the manual scheme runs alongside the AUDDIS scheme.

PDD stands for Paperless Direct Debit. PDD allows you to sign up new customers without getting them to fill out a paper form. This makes it ideal for any organisation that wants to take full advantage of the internet or sign people up over the phone . There are different rules that will apply to companies that would like to use this method of sign up. Please contact us for more information.

A Direct Debit can cover varying financial amounts and dates unlike a Standing Order which covers a specified amount.

The Direct Debit Guarantee provides assurance to the Payer that if an error is made in the payment of their Direct Debit by the Service User or the paying bank, they will be immediately refunded by their (the Payer’s) bank. It also confirms to a Payer that they may cancel a Direct Debit at any time.

The service user is the business that wants to collect the money.

A Service User Number (SUN) is a unique 6 digit reference used by Bacs to identify the business collecting the Direct Debits.

Providing an Advance Notice is necessary to remain Scheme compliant and reduces failed collections. The payer must receive an Advance Notice when signing up to pay by Direct Debit, when there is a change to the amount, and when there is a change to the due date. 

The Bacs processing cycle is a 3-stage process.

Stage One: Entry Day. Submission of collections file via software, bureau or banking platform (online business banking).

Stage Two: Processing Day. Valid files processed, otherwise rejected by Bacs (VOCALINK) with advice.

Stage Three: Due Day (collection day). Money moves simultaneously, debiting the Payer’s account and crediting the Service User. The stages above take place over 3 working days.

Bacs reports ensure a smooth-running and successful Direct Debit Collection Scheme. You will receive a number of Bacs reports that allow you to reconcile customer and collection details, including whether they are processed, rejected, returned, amended and/or cancelled. 

Bacs reports that must be downloaded are often called A-Reports – because they all start with “A”. Those for Direct Debits include AUDDIS (The Automated Direct Debit Instruction Service Report), ARUDD (The Advice of Returned Unpaid Direct Debit Report) and ADDACS (The Advice of Direct Debit Amendments & Cancellations Report).

Under the Direct Debit Guarantee, the Service User must agree to the Indemnity Claim process. This Guarantee is unlimited in time and amount, so a Payer can always request a full and immediate refund from their paying bank or building society if they believe that an error has been made.

ClearDebit provides the products and services that businesses need to process Direct Debits with Bacs. To use ClearDebit, a business must have a Service User Number (SUN). 

You can collect one-off, regular or variable Direct Debit payments. 

There are no limits on the number of Direct Debit’s you process or the value of the Direct Debit’s you process via our Bureau or software when you hold a bank sponsored SUN.  

The funds you collect are paid directly into your bank account. We’ll send you an invoice for your fees.

Direct Debit’s go through a 3 stage Bacs processing cycle which takes 3 working days. You will receive your payments into your bank account on the day of collection. 

Your business name and Bacs reference number will appear on your customers bank statement as the reference. 

If you’re not sure which product is best suited to your business, knowledge and resources, please reach out to our sales team who will be happy to discuss your requirements and advise on what would be the best option. 

We will need some personal details to help us verify your identity and some basic information on the company or organisation you are collecting for. We will also need your Service User Number (SUN) and details of the sponsoring bank. 

Unfortunately, we can’t currently support businesses that don’t have a SUN.

A Bacs Bureau submits transactions through the Bacs service on behalf of third-party organisations. When using a Bureau, businesses send files containing all of their Direct Debit and Direct Credit transactions to the Bureau, which then processes the file and sends it to Bacs. All Bacs Approved Bureaus are subject to regular inspection and review by Bacs to ensure they meet the standards set by the scheme.

Yes, ClearDebit is Bacs Approved for our Bureau, Mosaic software and Training. 

If you’re using our Bureau service you can view your payments by logging into our customer portal, which gives full visibility of payers, payments, reports, historic data and Bacs reports. 

If you’re using Mosaic software, can view payers, payments, customer reports and Bacs reports and historic data directly within the software. Bacs messages are applied automatically to payers and are also viewable within the software. 

Our Direct Debit In Depth Training course covers all of the rules and guidelines that you need to comply with. It also gives valuable insight into how to maximise the opportunities that Direct Debit presents.

Yes, we offer an onsite training course if there will be 6 delegates or more from your business. 

Yes, you will receive a certificate of achievement which shows that you attended one of our training courses. This can be shown to your bank if it is required when applying for a Service User Number. 

Yes, our training course is Bacs-accredited. 

It is advised that you attend training if you are new to working with Direct Debit’s and then at least every 3 years following that. The scheme rules change each January, so we recommend frequent refreshers to ensure compliance. 

As a Bacs Approved Bureau, we adhere to strict Bacs regulation and FCA rules regarding security. As a Bureau we are also regularly audited to ensure we are keeping to Bacs standards, and are proud that we have we have been providing approved services for over 17 years.

If you are using our software to manage Direct Debits in-house, we do not hold any funds. You will send your files to Bacs via the software. As your SUN is linked to your bank account, once the file has been processed with Bacs, collected funds go directly into you bank account from the payer’s account.

As a Bacs Approved Bureau and software provider, ClearDebit adheres to data protection rules and regulations set out by the FCA and Bacs.

Yes, your customers are protected by the Direct Debit Guarantee.