4 Reasons Your Business Should Use Direct Debit

If you are ready to look for small business direct debit set up, then you…

If you are ready to look for small business direct debit set up, then you are on the right blog. Direct debit is one of the most important payment methods for businesses, but it’s not always used to its full potential. Direct debit is faster and more reliable than credit cards or bank transfers, while also offering a better user experience for customers. Here are 5 reasons every business should use direct debit:

Direct debit is fast — Most direct debit payments are processed within two days of being initiated. Compare this to bank transfers, which can take up to five days to process, or credit cards, which can take around two weeks. Direct debit offers a significantly faster turnaround than other payment types.

1. Reduced late payments

With direct payment, money is transferred electronically from a customer’s designated bank account to your company’s account on a pre-set date. If a customer doesn’t have enough money in their account to cover a payment on that day it will be declined rather than going through and incurring an overdraft charge or late fee.

Less staff time spent chasing down payments: Direct debit relieves your staff of responsibility for following up with clients over unpaid invoices or late fees.

2. Improve your cash flow

You can get paid on time, every time. With direct debit, you don’t have to worry about late or missed payments. Your customers will forget to pay their bills sometimes — it happens. But with direct debit, you won’t have to remind them — they’ll never miss a payment again. And if they need to change their payment details, they just update their info online. Save time and money on paper billing. Direct debit gives you better visibility into your cash flow so you can make more informed decisions as your business grows. And because you don’t have to waste time sending bills and invoices by mail, your accounting costs go way down too. Focus on making a great product instead of chasing unpaid invoices.

See also  Best Causes Why Hiring A Skilled Emblem Design Is A Good Thought 

3. It saves you time

Direct debit can reduce the need for repetitive administrative tasks by eliminating credit card transaction fees, monitoring bounced checks and tracking down late payments. To put it simply, anything that can cut down the amount of time you spend on non-revenue generating activities is worth considering. Not only does direct debit save you time, but it can also free up resources to help focus on more important customer service activities.

4. It’s easy to set up

This is one of the biggest advantages of Direct Debit for businesses; it’s really easy to set up. If you have an online banking system, it’s as simple as logging into your account and filling out an online form.Credit card fees can quickly add up. And some credit card providers charge higher fees for international customers, which could mean a lot of extra costs for your business if you have an international customer base.

Direct debit fees are usually much lower than the fees charged by credit card companies. For example, when you process a direct debit payment with GoCardless, our fee is 1% (capped at €2) per transaction — no matter where your customer is from.