The Direct Debit Instruction: What it must include.

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The Direct Debit Instruction: Why it is important and what it must include.

The Direct Debit Instruction (DDI) is a critical component of setting up and managing direct debit payments in accordance with the guidelines provided on the Bacs website. Understanding the importance of the DDI and what it must contain is essential for compliance and seamless payment processing. Let’s explore the significance of the Direct Debit Instruction and its necessary elements as per the guidance provided on the Bacs website.

Importance of the Direct Debit Instruction:


  1. Authorisation: The DDI serves as the customer’s explicit authorisation for you to collect payments directly from their bank account. It ensures compliance with the Direct Debit Scheme rules and provides a legal basis for initiating direct debit transactions.


  1. Compliance with Bacs Guidelines: By adhering to the guidance provided by Bacs, you ensure that your direct debit processes are in line with industry standards, promoting transparency, trust, and reliability for both you and your customers.


  1. Payment Details and Communication: The DDI contains crucial payment information, such as the frequency, amount, and collection dates. It establishes clear communication channels between you and your customers regarding payment expectations and facilitates effective customer support.


Here is a list of essential elements that a Direct Debit Instruction should contain:


  1. Clear Authorisation Language: The DDI should clearly state that the customer authorises you to collect payments from their bank account. It should explicitly mention that it is for an ongoing direct debit arrangement and not a one-time transaction.


  1. Bank Account Details: Include the customer’s bank account information, such as the account holder’s name, account number, and sort code. This information is necessary to accurately initiate the direct debit transactions.


  1. Payment Information: Specify the payment frequency, whether it’s weekly, monthly, quarterly, or as otherwise agreed upon. Include the payment amount or how it will be determined (e.g., fixed amount or variable based on usage).


  1. Collection Dates: Clearly state the dates on which payments will be collected from the customer’s bank account. Specify if the collection dates will be fixed or if they may vary (e.g., based on weekends or holidays).


  1. Contact Information: Provide your business’s contact details, including your company name, address, email, and phone number. This allows customers to easily reach out to you for any queries or changes related to the direct debit arrangement.


  1. Cancellation Rights: Inform the customer of their rights to cancel the direct debit arrangement. Clearly state the cancellation process, including any notice period required. Provide instructions on how customers can initiate the cancellation and the appropriate channels to communicate their decision.


  1. Mandate Reference: Assign a unique mandate reference to each customer’s DDI. This reference helps identify and track individual mandates for administrative and auditing purposes. It ensures accurate record-keeping and simplifies reconciliations.


Including these elements in the Direct Debit Instruction ensures that both parties are aware of the terms and conditions of the direct debit arrangement. It establishes clear communication and authorisation, promotes transparency, and helps prevent misunderstandings or disputes related to payment collections.

Remember to review and adhere to any specific guidelines or requirements provided by the Direct Debit Scheme or the Bacs system to ensure compliance with industry standards. Regularly updating and maintaining accurate DDI records will help you manage direct debit payments effectively and provide a seamless experience for your customers.


Need Help with Your Payments?

At FastPay, we help a multitude of businesses and organisations take care of their payments. From our Direct Debit Managed service and Powerful Integrations to the FastPay Direct Debit Bureau, we’re committed to providing a payment solution tailored to our client’s needs.

Start a conversation with our friendly team today by calling 0161 737 5290 or get in touch online.


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