Have you ever heard about the funds that are possibly being transferred through electronic media? It is quite possible if you are residing in the UK, you can transfer payments from one UK bank account to another bank. Bacs payment is your go-to solution in this regard that ensures bank-to-bank transfer and is commonly used in the UK but what is Bacs payment? As mentioned above it refers to the most commonly used method of bank-to-bank transfer in the UK.
If we further look into the types of bacs payment direct debit and direct credit are the major types of Basc payment. By direct debit, we mean that one of the parties is allowed to pull off the money from another party’s bank account. Whereas in the case of direct credit, one party have access to deposit the payment to another party’s account. We have provided you with the basic details in this blog. This includes the explanation of the introductory explanation of Bacs and common types of Bacs payment. However, we will take start with the explanation of what is Bacs payment.
What Is BACS Payment?
The abbreviation of Bacs is Bankers Automated Clearing Services. The service provided by Bacs is well managed and operated well to keep the customers satisfied. According to research, there are a million people who trust and regularly use direct debit and direct credit payments. This makes it a common method to use in the UK. Other than Bacs, there are multiple options that can serve the same cause.
Moreover, there are several other options that you can use and enjoy the features like same-day payment and real-time payments etc. This makes high-value transactions easier for business-related individuals.
What Are Several Types of BACS Payment?
As discussed above, Bacs direct credit and Bacs direct debit are two main types of Bacs payment. The introduction to these types along with the explanation is given below.
Bacs Direct Debit:
Bacs direct debit is a payment method that will allow you to pull the amount of money they owe you directly from the account of clients. If you act as a payee, you have complete control over what amount of funds you can pull out from the account of customers as well as at what time you will do it. It depends on your suitability.
Bacs Direct Credit:
Bacs direct credit refers to the push payment that allows your clients that they can easily deposit the payments directly to your account. It is the authority of the payer that can have control over push payments. They will track the details of how much is the amount that they owe to pay and at what time they will make the payments.
Advantages of Direct Debit and Direct Credit:
The payment methods like direct debit and direct debit have the most advantageous features which is a popular reason for the common use of Bacs payment in the UK. Some of the advantageous features are listed and explained below:
- It is possible to ensure low-cost transactions while you are using the direct debit method and it is more advantageous than the use of a debit card.
- You need to forget worrying about any hidden charge issues as this makes it a great source of paying your regular bills.
- There is no chance of stolen credit and debit cards. You have a future-proof option that does not have any expiry issues and this will ensure to pay bills on time.
- In the case of Bacs direct credit, you can enjoy an easy approach to automation, reconciliation and remittance.
- It sets you free from the usage and handling of cash which is a burden in itself. Especially when you go through this struggle on a day-to-day schedule.
The Bottom Line
Now that you have gathered a basic piece of information about what is Bacs and the main types of it, we can bring the discussion towards wrapping up. Finally, we can sum up by saying that Bacs is a popular payment method because of the hassle-free process that can easily make anyone a regular user. It is the most common payment method among buyers and sellers in the UK as well. However, if the payment method is not used according to the set of limitations, there will not be any factors to enjoy.
This can rather lead to fines and penalties that can cause damage to your business reputation. We hope these few minutes of reading will help you to use the right payment method according to your business suitability and let you save time from the hassle of other payment methods.
Disclaimer: The information about what is BACS provided in this article including text and graphics is general in nature. It does not intend to disregard any of the professional advice.