Improving cashflow

Who doesn't want to improve cashflow?

One of the central benefits of Direct Debit is knowing when a payment will be going into your account. It means easier forecasting and better control of your cashflow.

To make the most of these benefits keep these points in mind:

• Double check that the Direct Debit Instruction has been filled out correctly by your customer before sending it to the paying bank
• Ensure there are no qualifications added by the payer
• Ensure your customers receive advance notice. This will give them sufficient time to fund their account to meet the payment
• Use a separate Direct Debit Instruction for each contract. This provides clarity for the customer and the paying bank. Should the customer need to cancel one contract there is no risk of cancelling all the payments
• Offer the customer as wide a range of payment dates as possible. This puts the customer back in control, by choosing the date which will ensure funds are in their account, leading to a reduction in unpaid Direct Debits
• Offer Direct Debit for occasional payments.* This gives customers the opportunity of choosing to make irregular as well as regular payments by Direct Debit
• Use Direct Debit to collect one off payments.* This provides a useful alternative to cheques, cash and credit/debit cards (only available to organisations who use AUDDIS)
• Notify the customer when representing an unpaid Direct Debit. This will allow them to fund their account and ensure they do not receive further bank charges for being overdrawn
• Process ADDACS advices immediately or within three working days of receipt. This will ensure your data file is up to date and that collection is made against the correct details, it will also reduce unpaid Direct Debits
• Automate the checking and follow up procedures for unpaid Direct Debits. This will enable you to offer a smarter customer service. Most banks can provide electronic data on unpaids
• Adopt AUDDIS to reduce your costs, automate your systems and minimise errors.

*Don't forget to use the Direct Debit Guarantee which includes information about customers telling you when they want an amount collected.