Accessing the Direct Debit scheme

Like any other payment method, the Direct Debit Scheme offers its own complex maze of rules and regulations that businesses must adhere to.

Compiled by Bacs, the organisation responsible for the clearing and settlement of UK Direct Debit, the Direct Debit scheme rules act as a failsafe to ensure service providers remain fully compliant.

A breakdown of the rules can be found in the Service User’s Guide and Rules to the Direct Debit Scheme, however as a time-saver, we have condensed the key aspects below.


Becoming a service user

In order to join the scheme and become a Direct Debit service user, an organisation must first contact its bank in order to gain sponsorship. For a company to be considered for Direct Debit sponsorship, they must:

  • Have a UK sterling bank account
  • Complete and lodge an indemnity with their sponsor

The sponsor will take into account variables such as:

  • An organisations contractual capacity
  • Its financial standing
  • The quality of its administrative control

Once granted, the sponsoring bank will issue the organisation with a Service User Number (SUN), which will serve as their unique ID.


Direct Debit Instructions

At this point, service users are free to think about taking Direct Debit payments. In the first instance, a Direct Debit Instruction must be raised. This authorises a service user to collect any amount of money at any time, as long as advanced notice has been given to the customer.

It is the responsibility of the service user to ensure that any recorded information is complete and accurate before lodging it to the payer’s bank. Any rejected Direct Debit Instructions will be sent back to the service user.

It is down to the service user to ensure that all payments are collected legally, without breaching consumer protection or other legislation. Likewise, any other monetary contract between the customer and the service user falls outside of the banks Direct Debit jurisdiction.