Bacs is a not-for-profit member body which has been an essential part of automated payments and electronic transfers in the UK, US and Europe for decades. An industry body owned by 16 leading banks and building societies, it uses Direct Debit and Bacs Direct Credit to carry out transactions, and is the hidden spine of the UK’s automated payments .structure “Bacs software” is a phrase used to refer to a software solution which automates Bacs payments.Â

Although many people haven’t heard of the group, they will almost definitely have used its services. During 2013, 5.67 billion individual payments were made by UK employers, employees, traders or customers. Three quarters of the adult UK population presently have at least one Direct Debit set up (for subscription services, to pay utilities, phone or internet bills or to donate to charity) while Direct Credit transfers are used by organisations paying benefits, wages or salaries.

However, you shouldn’t just trust any company claiming to offer Bacs software for automated payments. The body very tightly controls which software suppliers are permitted to use their two software offerings, Bacstel-IP and Secure-IP for Faster Payments. Solution suppliers must demonstrate that they can offer the highest level of security for their Bacs payments, and are tested by the body through a range of processes before they may legally advertise themselves as using ‘approved software’. Look for the Software Service Logo, or simply look up the company you’re considering on the body’s own online directory of approved organisations.Â

A good approved payment system should give direct integration with your office and accounts system to automate your files, invoices and bills into the template needed to carry out a Bacs payment: Faster Payments, Direct Credits or Direct Debits. All stages in the process should be password-controlled, and the software should fulfil all requirements for you in order to make and receive payments within three days.Â

Bacs software is used by many different companies across many different industries. It can be used by employers to make sure that weekly wages, monthly salaries, or workers’ mortgages and pension contributions are always on time, secure and accurate. It can also be used to take Direct Debit and other subscription payments, without the accountant having to do anything manually. It’s crucial to make sure that you’re using a reliable automated payments provider – but when a system is Bacs approved, you know that it’s safe and reliable thanks to their exhaustive regulation for licensees.Â

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