As your business grows, so does your need to manage financial matters quickly and efficiently. Whether you are receiving payments from customers, or need to make outgoing payments to employees, vendors, or other suppliers, it is critical to have a financial payment plan in place.
Bacs is a solution that is used throughout the UK for the quick and secure handling of financial transactions. In fact, Bacs payments are the number one way to both send and receive money in the country.
What is Bacs?
Formerly known as Bankers’ Automated Clearing System, the Bacs system is managed and operated by many of the UK’s leading banks and building societies. This organisation is called the Bacs Payment Schemes Limited and its purpose is the transferring of funds directly from banks. The Bacs system uses a secure, internet-based service called Bacstel-IP to make payments between banks. It is considered to be the largest Public Key Infrastructure in the world. There are several types of payments that can be made through bacs including direct debit, bacs direct payments and faster payments.
Bacs direct debit is a simple and cost-effective way of receiving recurring payments. These payments are made by a customer who gives bank authorisation to allow an organisation to collect payments from their account on a recurring basis. It is a safe way for customers to make payments because of the UK’s Direct Debit Guarantee, which protects customers from fraudulent payments.
This service is commonly used in the UK for payments such as salaries, tax credits, state benefits, and pensions.
The standard bacs payment time for each of these is three business days. However, there is another type of bacs payment called faster payments that provide same-day payments. Faster payments are ideal for situations where there is a last-minute or unexpected business expense that needs to be paid immediately.
How Does Bacs Software Benefit Businesses?
In order to connect with Bacstel-IP and utilise its payment services, businesses must use a Bacs approved payment software. There are numerous benefits of investing in this software and using the Bacs system. Not only does automated bacs software free up valuable time, it can help to reduce costly errors, and help business owners stay in control of the financial matters of the company.
Bacs can rapidly process secure payments for businesses. It can also track and view payment status information online, which is a great feature for those who need to closely monitor payment activity. It offers online support for electronic reporting and will provide your business with a confirmation once a payment has gone through. Another benefit of electronic payments is that you don’t have to worry about any cheques getting lost in the mail. And payments are processed within three days. Since the software is automated, you can spend less time on processing payments and more time focusing on building and managing your business.
In addition to being simple to use and cost-effective, bacs software is an extremely secure way to manage sending and receiving payments. The Bacstel-IP system is protected with SSL encryption. This encryption covers any computer you access to use bacs. It is also self-monitored and validates both user and data authorisation.
Bacs is Widely Used Throughout the UK.
Bacs services continue to grow at record-breaking levels in the UK. In 2014, Bacs processed 5.8 billion transactions. This number grew to over six billion transactions in 2015. In fact, 66% of all UK residents prefer to pay all their bills using the direct debit service. More than 150,0000 organisations in the UK use the bacs direct credit service to process payments, and 90% of all workers in the UK are paid through bacs direct credit.
If you are not currently using the Bacs payment system for your business, it may be time to modernise your company by investing in a Bacs Approved Solutions Supplier (BASS) software.