Bacs stands for Banks Automated Clearing System. It is an ideal system for making regular automated payments to repeat customers and employees. Currently 70% of salary payments to the UK’s workforce are made via Bacs.
Bacs payments can be made via a ‘File’ of transactions or via dedicated software that links to the bank account making the payment.
Bacs approved services
The range of Bacs approved services has been introduced to help organisations make and receive payments as easily, securely and cost effectively as possible, assured in the knowledge that the approved/accredited third party services of software, bureau services and training all meet the meticulous quality requirements developed by Bacs. These services include:
- Bacs Direct Debit – A Direct Debit is an instruction from a customer to their bank or building society authorising an organisation to collect varying amounts from their account, as long as the customer has been given advance notice of the collection amounts and dates.
- Bacs Direct Credit – Bacs Direct Credit is a simple, secure and reliable service, which enables organisations of all sizes to make payments by electronic Bacs transfer directly into a bank or building society account.
- Bacs approved software – Only software solutions that have passed rigorous testing and approval processes are able to connect to BACSTEL-IP for the BACS service and/or Secure-IP for Faster Payments. Since Bacs approves all BACSTEL-IP and Secure-IP software before it reaches the marketplace, users are reassured that the software has surpassed set quality standards.
The benefits of making Bacs payments
As the Bacs process is electronic, it removes the need to write cheques, which can be a costly process, or make individual electronic payments which are subject to human error. Bacs payments can be made much later in a business day, up to 9pm and are cleared within two business days to any bank account.