If you run a domiciliary agency that offers care services for the elderly in their own homes and are switching to taking payments using Direct Debit, then this handy checklist will help you.
Here we explain the process of setting up Direct Debit for home care agencies, using the following steps:
- Pick the Direct or Indirect Option
- Outsource to A Direct Debit Specialist Provider
- Sign Up Clients
- Share Mandatory Advance Notice
- Review Your Bank Account
In the UK, the Direct Debit scheme is run by Bacs. There are two routes that a business can take to set up Direct Debits with Bacs. The first is as a Direct Submitter and the second is as an Indirect Submitter.
– Direct Submitters
Direct Submitters submit their Direct Debit paperwork directly to Bacs using Bacs-approved software and procedures. They have their own Service User Number (SUN) that has been issued by their bank.
These are usually large organisations that have a substantial volume of Direct Debits to administer. There is an initial cost outlay to pay for the relevant software and staff training, as well as ongoing expenditure on software and training updates. It can also take time to set yourself up as a Direct Submitter due to the approval process.
However, due to the volume of Direct Debits collected by larger companies, it works out cheaper and more efficient to manage this function in-house.
– Indirect Submitters
The majority of domiciliary agencies looking to use Direct Debit for home care payment collections will take this route as it’s more affordable and efficient than managing in-house.
An Indirect Submitter outsources its Direct Debits to a Bacs-approved and accredited specialist provider, such as FastPay.
This third-party will manage the process with Bacs on your behalf, handling the file submission and providing you with the relevant documentation and tools to manage your Direct Debit facility.
Indirect Submitters can either use their own SUN, if they have one, or utilise a SUN provided by the Direct Debit provider.
The next step as an Indirect Submitter is to appoint a Direct Debit specialist provider. Many, such as FastPay, specialise in managing Direct Debit for small to medium enterprises.
To set up your agency’s Direct Debit for home care payments with FastPay, you’ll need to select from the following two services:
A domiciliary agency with a Service User Number (SUN) from their bank can use this service.
The managed service is for a home care agency without a SUN. You’ll be able to use a personalised SUN provided by FastPay.
Both services are quick and easy to set up, taking as little as 24 hours. FastPay will provide you with the relevant documentation you require to get your customers signed up to Direct Debit.
Outsourcing your home care agency’s Direct Debit management is affordable. See more on pricing here.
Once you’ve appointed a third-party provider to manage your Direct Debit for home care services, then you’ll need to move your existing clients onto the scheme and sign up your new clients.
Many clients will already pay for services and products using Direct Debit. It was first introduced in 1968 and so is likely familiar to many of your elderly clients. However, if your client isn’t aware of Direct Debit, then you might need to organise some time with them, or their family members or designated carers, to talk them through the process.
The first thing each customer will need to do is complete a Direct Debit mandate.
This is a standard form created by Bacs that instructs a customer’s bank to authorise you to take payments from their account on a recurring basis.
Mandates can be completed over the phone, by filling out a paper form or by using a secure area of your website. Your clients might prefer to complete a paper form, due to problems with hearing, or no access to the internet.
If you opt to outsource to FastPay, you’ll be provided with the relevant paper forms, phone scripts and fully integrated website sign-up forms. Once you’ve gathered these completed mandates from your customers, you provide the information to the Direct Debit collection company. This provider will then submit the relevant files and information to Bacs.
Each mandate also includes information about the Direct Debit Guarantee. This set of safeguards from Bacs offers protection against Direct Debits being taken by mistake or fraudulently.
Completed mandates authorise you to collect payments from your customers’ bank accounts. However, you must inform your customers in advance of taking their first payments by communicating a Mandatory Advance Notice. This can be shared with your customers by letter, email, text message or over the phone.
The notice confirms bank details, specifics about the collection and conveys the Direct Debit reference number you’ll use.
Every time any information on a customer’s Direct Debit changes, for example the amount, frequency or collection date, then you must also notify them in advance.
If you outsource to FastPay, you’ll receive templates for Mandatory Advance Notice letters, as well as various other templates you can use to communicate with your clients.
The next step after you have completed the mandates, given advance notice and supplied all required information to your third-party Direct Debit provider is to review your bank account after the funds have been deposited.
The payment is debited from your customers’ accounts on the date specified in the mandate.
These funds are then credited into a Client Trust Account held in your name by your chosen provider. Once the money has cleared, it is transferred into your nominated bank account.
On occasion, Direct Debits are returned or fail. FastPay (or your chosen provider) will notify you when this happens so that you can communicate with your customer and attempt the collection again.
Direct Debit for Home Care Services – Get Involved
Setting up Direct Debit for your home care business and taking your first payment by Direct Debit is quick and straightforward when you outsource to a specialist provider such as FastPay. Get involved today.