Using direct debiting

yomchi

Hello all,

I'll keep this simple, I'm just looking for a wee bit of advice.
Without going into huge detail, if a company offering domestic external property maintenance wanted to start getting its customers paying by direct debit, how would that work?
I know with large companies, you can give them your account details and they set up the DD and away you go. But with smaller companies can this be done? Does the householder have to do the paperwork and the like to start paying DD?

Any advice greatly appreciated

information

Jon wrote: »

Hello all,

I'll keep this simple, I'm just looking for a wee bit of advice.
Without going into huge detail, if a company offering domestic external property maintenance wanted to start getting its customers paying by direct debit, how would that work?
I know with large companies, you can give them your account details and they set up the DD and away you go. But with smaller companies can this be done? Does the householder have to do the paperwork and the like to start paying DD?

Any advice greatly appreciated

http://www.sentenial.ie/ is the only company I know who offer a direct debit collection service to small companies

yomchi

Thanks for that info, info

Is is something that you have to get a seperate company to do or can the banks do it too?

AccessQuery

Jon wrote: »

Thanks for that info, info

Is is something that you have to get a seperate company to do or can the banks do it too?

Hi,
Just picked up on your tread. This is something I've done at for myself. Unless your monthly collections are of a decent quantity and value the set-up fees charged by 3rd party providers can be quite high.

The banks don't offer any DD management services they'll just refer you to 3rd parties.

You've two cost effective options...

1) Get clients to sign Standing Orders (SO).
SO Pros:
Payments will run automatically. Can improve Cash Flow.

SO Cons:
Can only run for fixed amounts. Customer can cancel without your knowledge and you'll only know when payment doesn't arrive.

2) Set up Direct Debit (DD) process via your bank.
DD Pros:
You decide when to collect payments. Variable Payments can be collected. Can improve Cash Flow. If customer cancels the DD you'll be informed by the bank. If customer changes bank account you'll be informed by the bank. Customer moneys are fully protected by their own bank.

DD Cons:
Takes a little time to set-up with your bank. Need software to put the DD file together. Customer can cancel the DD mandate at any time. Customer must be informed before DD is taken from their account by letter or e-mail.

I've been through option 2 a few times so if you need any further info let me know.

Regards,
Andy

kittenkiller

Have you investigated Direct Debit Plus (the paperless mandate system)?
http://www.ipso.ie/index.php?option=com_content&task=view&id=35&Itemid=172
It's amazingly easy to maintain once you've gotten onto your bank to set it up for you.
Once you've got that moving, you can go to a 3rd party banking company to submit your payments if you're short on staff.

DublinDilbert

Could you not just set yourself up to debit laser cards???

Some of the big driving schools are doing this when ppl take driving lessons, and don't even need a signature, which seems wrong.... :eek:

AccessQuery

Hi,
The previous two posters have suggested DD Plus and payments by Laser card. I've used both at different stages of growing my business and they worked very well.

FYI DD Plus or Originator Plus can only be used by a payee that has a DD processing agreement already in please with their bank and from experience third party DD collectors don't offer DD Plus / OP.

If the the actual volume of payments are low the Laser would be the smart option to go for. Speak with your bank about the fees they'll charge on the Laser collections. I'd also strongly suggest shopping around the various banks to see what else you can get. Some offer free business banking for 2 years on new business accounts, not to be sniffed at.

On the Laser front get the client to sign a variable mandate for the payments, otherwise you'll have to ring them every month or whenever bills are due.

From experience people that sign payment mandates very rarely mess you around. Also as I mentioned in my previous posting the Payers bank keeps them indemnified for any payments collected. If there any queries, moneys are given back to the payer and it's then up to the payee to show payment is actually due. If rules of DD schemes/Payment mandates are adhered to there should never be a payment dispute!!

edanto

Well, this thread is a year old, can I just ask Jon if you went down this route and if so how it worked out?

A friend is looking for this type of thing, has several repeat customers with variable monthly payments and I'm just looking into the feasibility of it.

Based on the number of payments, I'm starting to think that taking Laser payments might be the best bet for him.

For that, would the steps be:

1. Get a Laser terminal
2. Customer signs mandate
3. Send out the bill 14 days in advance (that's the notice that you have to give on a DD, might be good practice to do the same with the Laser bills)
4. On the payment date, punch the numbers into the terminal?

Step 4 sounds like it would be annoying, can it be automated?

When I'm looking at the potential costs, I think I'll have to get on to the banks... this is from the FAQ on the lasercard.ie site:

Q: How much will this cost me?
A: This depends whether your equipment is owned by yourselves or a third party. You will need to seek further information from your acquiring bank or from hardware and software suppliers

Can anyone give any pointers on typical transaction costs, please?

edanto

just a quick bump to see if anyone that's around at the moment might know a bit about the question, please?

robbie1876

Hi edanto,

I use www.sentenial.ie for collecting direct debit payments and am happy to recommend them. The payments from customers are variable each month and it's all very easy to set up and manage. If you have an accounts package (I use Quickbooks) you can export payment information to a file and bulk upload your monthly payment information to Sentenial. Couldn't be easier really.

Before I signed up with Sentential I was given the runaround by my bank who said I could become a direct debit originator with them, but predictably when push came to shove they weren't interested in the low volume I was doing. So Sentenial was the best next option. There is an initial setup fee which is quite expensive so you have to do your sums and figure out if it's worth it. In my case I was collecting money from pubs who can be notoriously bad payers, so it's totally worth the savings versus chasing them for invoices every month.

I don't know about Laser terminals as such, but I would imagine there will be an initial setup fee and charges to get one, and I wouldn't be surprised if it is almost as much as the Sentenial setup fee.

Have fun!

Robbie

patftrears

robbie1876 wrote: »

Before I signed up with Sentential I was given the runaround by my bank who said I could become a direct debit originator with them, but predictably when push came to shove they weren't interested in the low volume I was doing. So Sentenial was the best next option.

I though you had to have to be a DD originator before you can use Sentential and they are just a software solution to streamline the process of submitting the amounts to your bank for collection, am I wrong, is this a new feature Sentential now offer ?

robbie1876

No, Sentenial are the DD originator. Your customers essentially sign a DD form with sentenial, who then collect the money and send it to you less their fees. That's the deal I'm on, they may have other services like you mention too.

It's a big deal getting a DD originator number of your own, banks really don't like giving them out in my experience.

Nuttzz

robbie1876 wrote: »

It's a big deal getting a DD originator number of your own, banks really don't like giving them out in my experience.

Yes they will make you jump through hoops for this.

The big issue for the banks is that if you pull 10k out of a customers account and then withdraw it straight away and head off then when the customer asks for a reversal the bank would have to take the hit, as your account has no funds. This is their big concern, it also depends on the relationship you have with the person in the bank and if s/he's willing to fight your corner or not

edanto

Dammit just spoke with Sentenial and they no longer offer that service to new customers!! They have moved in a new direction with their business, apparently.

I really would like to avoid going down the 'becoming an originator' route.

podgeen

I would recommend you look at taking recurring payments via your customers credit or debit card. In the Irish market WorldnetTPS have a service called SecureCard and Realex have RealEFT. You will need a Merchant Services Agreement to use either of the above services. You can take the customers card details over the phone or else have them signup on your website. There was a similar question asked on the online payments forum on my website which will provide you with more information.

Dave

robbie1876

edanto wrote: »

Dammit just spoke with Sentenial and they no longer offer that service to new customers!! They have moved in a new direction with their business, apparently.

I'm quite surprised to hear that, they still have the Eurodebit product heavily advertised on their site. I'm sure if Sentenial won't offer direct debit solutions to SMEs, somebody will (or already has) taken their place.

podgeen

robbie1876 wrote: »

I'm sure if Sentenial won't offer direct debit solutions to SMEs, somebody will (or already has) taken their place.

Realex payments offer this service branded as RealEFT - you can take recurring payments from credit cards, debit cards or bank accounts.

Dave

edanto

podgeen wrote: »

I would recommend you look at taking recurring payments via your customers credit or debit card.

Thanks, but we've looked at it and it seems very laborious. (1) We would have to punch the card numbers into the terminal each time. (2) We would have to ask the customer each month for their CCV number, as it's reckless to store that piece of information, plus there are regulations around it

At the moment, it is a less favoured option, but it is still workable.

@robbie - I'm also amazed that they decided to withdraw that service, particularly in this kind of market.


Thanks very much podgeen for the heads up about RealEFT, I'm looking into it now.

edanto

Just judging by websites, Realex are streets ahead of Sentenial.

podgeen

edanto wrote: »

Thanks, but we've looked at it and it seems very laborious. (1) We would have to punch the card numbers into the terminal each time. (2) We would have to ask the customer each month for their CCV number, as it's reckless to store that piece of information, plus there are regulations around it

I do not believe this is the case. With the Realex and Worldnet systems you take the cardholder information once, add it to their system and then you can refer to it at a later time to make a payment. Give them a call and I'm sure their sales team will explain the process to you in more detail.

Dave

Realex: Keith

Hi Edanto,

To get back to your questions with regards to the processing of Direct Debits - Realex have a solution that is available in the market called our RealEFT product. This product is used to process recurring transactions, on both cards and bank accounts. There are a couple of requirements that you need to have in place in order to avail of this service :

1) To take direct debits on a recurring basis, you would need to get an originator number set up by your bank. There are two forms of this originator status, namely Originator Plus and Originator Standard. Originator Plus is the paperless option whereby you can take bank account details over the phone or via fax.
Originator Standard is the option whereby you need to receive the completed mandate document to set up the account to process recurring direct debits.

The Realex Payments system would enable you to manage your Direct Debit details, store the account numbers, sort codes and enable you to process the payment file to the bank.

2) To take cards on a recurring basis, you would need to be initially set up with a merchant service agreement from your acquiring bank. This is seperate to Originator Status and is provided by the acquiring function within the major banks.

Once you are setup with this merchant service agreement (E-Commerce for Web Transactions and MOTO for Telephone transactions), you can then process the recurring card transactions.

Realex Payments could store the card number for you(Laser or Credit Card) and create the payment file to be submitted to your acquiring bank, hence removing any PCI compliance issues on your side.

If you have any questions or require any further information about any of the above, please feel free to call us on 01-2808559.

Kind regards,

Keith

edanto

Thank you very much Keith.

I've also found your demo at http://resource.realexpayments.com/docs/RCEFT.html very useful.

Congrats on your web presence and customer service. At this stage, we're likely to go with you and will follow up with the salesperson that replied to my email query.

patftrears

podgeen wrote: »

Realex payments offer this service branded as RealEFT - you can take recurring payments from credit cards, debit cards or bank accounts.

Dave

Realex don't offer this service, you need to be a DD originator before you can use the RealEFT

edanto

True, we will have to go down the route of becoming an originator, which is exceedingly annoying.

I can't believe that no-one is interested in providing the type of service that Sentenial once did and still provide to their existing customers.

realex, can you tell me if your RealEFT product will post out the invoices to the customers 14 days in advance or if that's something I'd have to set up separately? I don't think it will, but it's a service I'd like to buy.

Realex: Keith

Hi Edanto,

If you wish to have automated invoices sent to your clients that would be something that you would use your CRM tool for, this CRM could be integrated into Realex to allow for more complete reporting and reconciliation. Realex Payments RealEFT service will process direct debit payments for you into your bank and provide full reporting on those payments as well as allowing you to manage your chargebacks through RealControl, our online reporting tool.
We would be delighted to discuss this with you in more detail so please give us a ring in the office here 01-2808559 and ask for Jonathan or Catherine.