Setting up Money Transfer by Direct Debit

Some Very Essential Tips For Foreign Exchange Transfers That You Must Follow when setting up Direct Debits for money transfers.

Money Transfer by Direct Debit

Gone are the days when suppliers had to chase their customers to get payments because most businesses now insist on a direct debit system of payment. In this system, the customer gives instructions to his bank authorising payments to the supplier. In cases where the business is of a continuous nature, the instructions state the amount to be paid and the frequency of the payment. Direct debit works wonderfully because it is a safe method of doing business and it allows both parties freedom from the tensions of payment and enables them to concentrate on other more productive aspects of their business.

Instead of setting up the direct debit system on their own, businesses are now turning to online agencies that undertake the procedure on their behalf. These are reliable agencies that set up a regular payment collection procedure with the help of direct debit. All that the business has to do is to register with the website of the online agency and provide information regarding the party from whom the collection is to be done along with the amount and frequency of collection. The agency will inform the bank of the payer about this direct debit. After the lapse of a pre-specified period, the payer's account will be debited and the amount will be credited to the payee's new account that will be set up by the agency for this purpose. The realised funds will then be transferred to the regular account of the payee by the agency.

Direct debit is a very popular method of making payments because it is simple, secure and reliable. Even individuals use it for giving standing instructions to their bank to transfer amounts from one of their accounts to the other depending on a specific need or for payment of credit card or other bills. In the case of businesses, direct debit saves time and money and makes the cash flow management easier and more organised. The other benefits of direct debit are:

Setting up Money Transfer by Direct Debit

With a direct debit system in place for transferring an amount from one account to the other on a regular basis, the person can plan his money flow properly so that any anticipated shortage can be made up on time.

The person or business that has to make payments on a regular basis might not remember when to pay and might default on the payments. With direct debit in place, payments will be made on time and there will be no likelihood of any penalties or increase in interest rates due to late payments. A lot of time and energy is saved because the person does not have to remember to take time off to go and make payments. In the case of businesses, the online agency sets up the direct debit system on behalf of their clients.

The direct debit system is secure because the payments emanate out of the bank and as such, other online methods that are liable for cyber crimes need not be used. There would be no likelihood of hacking of payment portals and diversion of funds. Moreover, the risk of credit card information getting into wrong hands would be eliminated.

Direct debit methods are paperless and because of this, not using paper helps to keep the environment green.

Whether you are running a business or whether you are paying off your loans individually, direct debit can be very helpful especially if you are going through an online agency.