Bacs: Direct Debit used by over 90% of consumers
Bacs Payment Schemes Limited, the UK organisation behind Direct Debit (DD), has recently published its consultation outcomes. The online report provides interesting insight into the success of the recurring payment method, and highlights areas of improvement.
Direct Debit is an essential part of the UK economy
Bacs confirms that DD remains the most popular way for consumers to pay their regular bills, and claims that it is an “essential part of the UK economy”. The report reveals that over 90% of consumers with bank accounts have at least one DD, with more than a third (38%) of households being “heavy” users, with more than six DDs.
Why is Direct Debit so popular?
It is the ease and convenience that is most valued, with 88% of those surveyed claiming “once payment is set up, I don’t need to think about it again”. Ease, convenience and effortlessness are what makes DD so popular, but it is also the Direct Debit Guarantee, that allows any payments made in error to be refunded, which gives consumers peace of mind.
Businesses and organisations surveyed also understand the benefits of DD. Having the certainty of regular incoming cash flow, and lower costs than other payment types, surely make it a popular choice. The report claims that 98% of payments have been collected successfully once submitted.
What improvements is Bacs considering?
Although the success of DD is evident, the survey has also revealed a number of areas where DD can be improved, so that both consumers and service users can fully benefit from its advantages. Bacs specifically wants to “ensure Direct Debit remains fit-for-purpose and relevant”.
The six areas that Bacs is reviewing for improvement are:
- Payment flexibility
- Pre-authorised Direct Debit collection
- Restricted Guarantee
- Facilities Management (FM)
- Account Verification
- Consumer Notification of Lodgement of DDI
The full report, with detailed information, can be accessed via Bacs.