Using Direct Debit for membership and subscription payments

Let’s be honest. The one aspect people want to consider the least when signing up to a gym membership, or subscribing to their favourite magazine, is the finance implication. They want an easy ride. A way to continue their payments without any real effort on their part. Organisations want something similar.

That’s where Direct Debit comes in. A quick and simple way for people to sign up from the comfort of their couch, Direct Debit provides a solution that benefits businesses and and their loyal, paying customers in equal measures.

No late payments

Direct Debit membership and subscription payments are collected on an agreed basis. This could be weekly, quarterly, monthly or any other suitable billing frequency. Rather than taking payments from cards, a process which has high default statistics, fees are taken from the customer’s bank account directly and the responsibility falls on the business, or their Direct Debit bureau, to ensure continual transactions are carried out.

Incentives and discounts

Time is money. Whilst Direct Debit proves a cheaper alternative to card payments, which costs two to three per cent per transaction and a flat fee of 20-30p, it also saves a great deal of administrative tedium. This has positive repercussions for a business’s bottom line. Instead of chucking away cash on collection management, money saved by using Direct Debit can be focused on member retention and acquisition. It’s a win-win for both parties!

Convenient sign up process

Speaking of member acquisition, piquing a potential customer’s interest up that first transaction can prove laborious – sales teams will certainly sympathise! Ensuring a quick and simple sign-up process (and a grade A selling point) will make your sales team’s job easier. Gyms across the country use DFC’s online joining portal, FastDD, as a way for new members to easily join their organisation. It’s accessible 24/7, allowing people to join even after their doors have closed for the night.

Protected and adaptable

Maybe someone wants to increase their video subscription to premium, or your health club is being refurbished for a month. Unlike its inflexible cousins (think standing order), Direct Debit payment amounts or dates can be adjusted in line with fluctuations. Making transactional changes is easy. An organisation must simply inform the customer of any amendments up to ten days before taking the payment, as per the Direct Debit Guarantee. Immediate refunds will be made in case of an error on either side, and Direct Debits can be cancelled at any time.

Direct Debit bureau management

Organisations that rely on a Direct Debit bureau to manage their Direct Debit transactions will see their collection rates, customer acquisition and attrition, and their reputation improve. A Direct Debit bureau, such as DFC, will do all the difficult work collecting, managing and chasing customers, so that businesses are never left out of pocket. This way, businesses can dedicate more time to the people that truly matter – their customers.

 

Find out why so many organisations are using forward-thinking Direct Debit collection company DFC to collect Direct Debits from their members and subscribers here.