Clear Academy Update: The team is growing!

Gavin Lawrence — Tue, 20 Mar 2012 14:05:56 +0000

Clear Academy is pleased to be working with Dave Howes.

This month, Clear Academy says welcome to Dave who brings a great wealth of experience from his previous roles working for Bacs. Dave joined Bacs in 1974 and was involved in the IT development and roll-out of AUDDIS and Paperless Direct Debit services. In 2008, after 34 years with Bacs, Dave worked as an independent consultant, during which time he was commissioned by Bacs to write the AUDDIS Migration Guide. He has also worked on an 18 month contract for Bacs as a Bureau Inspector. Dave’s knowledge and experience will further strengthen the Clear Academy consultancy team and we are pleased to be working with him.

Any questions for Dave? Contact us for more information.

Fancy a new career with Clear Academy?

Gavin Lawrence — Tue, 20 Mar 2012 13:55:26 +0000

Are you interested in a new career with Clear Academy? We are currently recruiting for a self-driven and highly engaging individual with an enthusiasm for motivating and training others. If you demonstrate passion and commitment, and have the ability to build relationships with confidence and ease then read more about this career opportunity and contact us today about joining the Clear Academy Training Team.

Making or Receiving Payments in Euro’s? SEPA: What should we know?

Gavin Lawrence — Tue, 20 Mar 2012 09:49:12 +0000

In February 2012 the European Union adopted a Regulation stating that within the Euro zone, all national Direct Debit and credit transfer schemes would be replaced by a single Euro scheme. Known as the SEPA Regulation (Single Euro Payments Area), it mandates that all national schemes, (for Euro payments), must be replaced by the SEPA scheme by February 1st 2014.

This new SEPA scheme offers benefits to companies trading within Europe as it will make it simpler and cheaper to send or receive Euro payments, from and to, anywhere within the area. From a consumer perspective, it will facilitate the transfer of funds between the UK and other SEPA countries for individuals who are working or studying abroad.

In news this month, Barclays Bank has announced a partnership with Sentennial, a provider of payment solutions, to provide Pan-European mandate management solutions for the bank’s SEPA Direct Debit corporate customers.

Whilst UK-based businesses and individuals who make or receive payments in euros will be affected by SEPA, we should stress that the UK, sterling Direct Debit scheme will remain in force for companies making and collecting payments in UK pounds. The UK Direct Debit scheme is operated and managed by Bacs who set out all the scheme rules in ‘The Service User’s Guide and Rules to the Direct Debit Scheme’, v3.5.

Do you have questions about SEPA or about the UK Direct Debit Scheme? Contact us to discuss.

Direct Debit Facts: Did you know…?

Gavin Lawrence — Mon, 19 Mar 2012 21:17:28 +0000

The Direct Debit Scheme offers benefits to both organisations and individuals and as a result, usage of the scheme is growing, (Source: Bacs, Facts and Figures):

3.32 billion Direct Debits were processed in 2011, a growth of 66% vs the number of Direct Debits processed in the year 2000.
The greatest growth in the use of Direct Debits occurred within Retail, where usage is up 252% vs 2000; Business to Business, where usage is up 219% vs 2000 and Subscriptions, where usage of Direct Debits is up 217% vs 2000.

Most individuals and companies are familiar with paying by Direct Debit:

Direct Debits are used to pay 67% of all regular personal and household commitments.
The average value of a Direct Debit was £82.

Is your organisation using the Direct Debit Scheme as widely and effectively as it could? Training on the scheme could make the possibilities ‘clear’.

Do you have questions about Direct Debit training? Contact us to discuss.

Is AUDDIS working for you?

Gavin Lawrence — Mon, 19 Mar 2012 20:46:56 +0000

Of all the Service User Numbers (SUN’s) in operation, less than half, (48%), are AUDDIS enabled, (Source: Bacs, Facts & Figures). Is it time that you migrated your system?

AUDDIS stands for Automated Direct Debit Instruction Service. Operating an AUDDIS system, allows an organisation to submit their Direct Debit Instructions to Bacs electronically rather than sending them by post. Any company that applies to collect Direct Debits directly will now automatically use this method. If your organisation currently sends all new Direct Debits by post then you have to go through a process of AUDDIS Migration in order to make the necessary changes.

Is it worth it? Well there are numerous advantages to using AUDDIS to submit new Direct Debit Instructions. These include: lower costs, increased accuracy and reduced time. See the Clear Academy website for more information about the advantages of AUDDIS. There are however, additional rules that need to be followed when moving to AUDDIS, again as described on the Clear Academy website. Migration is usually a one-off process for most organisations. It is essential to get the process correct and that is where specific AUDDIS Migration training can help.

Do you have questions about AUDDIS Migration? Contact us to discuss.

Don’t lose your Direct Debit Customers! A new Account Switching Service will require changes in how Direct Debits are managed.

Gavin Lawrence — Mon, 19 Mar 2012 13:16:44 +0000

In 2011, the Independent Commission on Banking recommended that a new current account switching service should be introduced to make it easier for individuals, charities and businesses to switch current accounts. The Payments Council and the Government supported the recommendation and committed £650-£850 million investment to deliver this service. As a result, from September 2013, switching accounts will be possible within seven days or less, compared to the average of eighteen days currently), and it will be backed by a guarantee. When an account is switched, the new account provider will arrange for all incoming and outgoing payment instructions to be redirected from the old account to the new one.

What will this mean for processing Direct Debits?

Increased competition and an increase in the switching of current accounts will mean an increase in the number and frequency of ADDACS reports.
As of next January, if you operate an AUDDIS system, it will become a prohibited practice to submit a ’0C’ code on receipt of a ’3′ reason code in your ADDACS report. If you are notified of a customers’ change of bank details you will need to set up the Direct Debit Instruction at the new bank with a ’0N’ code. Note: This only applies to an ADDACS ’3′ reason code, which applies when someone moves to a different bank, not an ADDACS ‘C’ reason code which relates to an account transferred to a different branch of the Bank or Building Society.

Do you have questions? Contact us to discuss.

Bacs processing dates Easter 2012

Gavin Lawrence — Wed, 14 Mar 2012 09:29:32 +0000

If the payment is to arrive in the account on…	…the processing date must be…	…and so the latest submission date is…

Thursday, 5 April	Wednesday, 4 April	Tuesday, 3 April
Tuesday, 10 April	Thursday, 5 April	Wednesday, 4 April
Wednesday, 11 April	Tuesday, 10 April	Thursday, 5 April
Thursday, 12 April	Wednesday, 11 April	Tuesday, 10 April

More updates to Direct Debit Rules

Gavin Lawrence — Mon, 23 Jan 2012 11:15:36 +0000

The Service Users Guide and Rules has been updated again with version 3.5 having now been released. There are only a few minor changes in this version with the key changes as follows:-

It is no longer a requirement of the Direct Debit Scheme that a paper Direct Debit Instruction is sent to a customer if they do not wish to go through the Paperless Direct Debit sign up process. It is now possible to simply not pursue that Direct Debit sign up.
As of January 2013 (Though this has gone into the rules now to give people some advance warning) it will become a prohibited practice for a Service User to send a “0c” transaction code to the old bank when a Bank has been transferred as a result of an ADDACS report code 3

The other major change is that Bacs have now provided example screens that will help developers with building their internet sign up pages. These can be used as a template which will help to get your internet screens approved by the sponsoring bank.

Direct Line first Car Insurance company not to charge for Direct Debit

Gavin Lawrence — Thu, 03 Nov 2011 14:02:35 +0000

Direct Line is the first car insurance company that we are aware of to offer motorists car insurance in monthly instalments by Direct Debit at no extra cost. Aalmost every other industry has embraced Direct Debit as their preferred method of payments to the extent that they throw incentives at us to sign up to a Direct Debit. We are always seeing Energy companies, telecoms providers, magazine subscriptions, and gym memberships offered at a discounted rate for Direct Debit.

Until now the car insurance industry has had such a fear of fraud that they have always been desperate to get our money up front, even though it makes life much harder and more expensive to collect through card payments and the other alternatives. In fact this has led to some of the worst Direct Debit sign up rates that we have seen. In figures released by Bacs last year a whopping 81% of all life insurance was paid for by Direct Debit as opposed to 51% in the Car Insurance sector.

Direct Line are certainly breaking some ground here but before we get too excited this may not be the leak that breaks the dam, Direct Line are only offering this until the 20th of November. Still it’s good to see one of the big firms trying this out and with them currently offering 12 months for the price of 10 on top, they may be worth considering if you are up for renewal.

Gavin Lawrence.

Firms pay out twice for claims with common Direct Debit Indemnity mistake.

Gavin Lawrence — Wed, 26 Oct 2011 15:56:49 +0000

There is one consistent mistake that we see from organisations when conducting our Direct Debit Training and Direct Debit Audits and it could prove to be a costly one.

The Direct Debit Guarantee states that a customer seeking to claim should contact their bank for a full and immediate refund. Yet many people automatically contact the Service User, i.e. the organisation that is collecting. Service Users do not seem to be as aware as they should be that any customers approaching them for a refund directly should refer them to their bank to raise the indemnity claim.

Many organisations that we have worked with are making refunds by remitting directly into the customer’s bank account. You may wonder what is wrong with that, the customer gets their money back and the problem is resolved.

But hang on….what happens if the customer also contacts their bank for a refund directly? With no proof that the sum refunded was anything to do with the Direct Debit the customer could end up with a double pay out.

The Direct Debit Scheme Rules specifically prohibit this method of refunding the payer. When we explain this to our clients they often explain that they would end up with irate customers that are demanding a refund. We understand this, so there are 2 things that you may be able to do to help with this.

1. Explain to the customer that they will get their money refunded straight back into their bank account immediately if they contact their bank. From experience with the major banks this would be the same day as cleared funds in most cases. This is likely to be faster than a Bacs payment direct to the customer.

2. If you still don’t think this would work for you, you are permitted to raise the indemnity claim with the payer’s bank on their behalf. There is a list of the correct contacts in the secure area of the bacs website.

Of course you are always better off avoiding claims in the first place by ensuring that you run the scheme correctly and that all staff have Direct Debit Training but if you do have an indemnity claim it is worth bearing the above in mind!