Using GoCardless for receiving Direct Debit invoice payments

Direct Debit is one of the most established, safe, trusted and inexpensive ways of receiving payments from your customers – whether one-off payments or regular charges. GoCardless handles Direct Debit payments for you, making it quick and easy to set up and use this method of payment.

Is GoCardless right for me?

The Direct Debit system has been around for decades and is trusted by millions of users in Australia and overseas. Using Direct Debit via GoCardless is a way to automate the payment of your business’s invoices and improve cash flow. It can also be used with online invoicing systems to reconcile bills on the spot.

To determine whether GoCardless is right for your business, answer these simple questions:

How many customers do you have?

Direct Debit is best for businesses with at least 25 customers, since payments are easy to set up and are then automated. Plus, failed payments will be flagged up, so you won’t be left out of pocket.

How much time do you spend chasing payments each month?

Think about this carefully – the emails, the phone calls, the wasted time spent on ageing summaries in your accounts. If this takes up more than two or three hours per month, then Direct Debit could be a good solution. Once a Direct Debit mandate is set up, payments are collected automatically from the customer at any time, with money clearing in between three and five days.

On average, how long do you wait for payment past your agreed payment terms?

Late payment shouldn't be a problem – but it is. Customers are often lax in their payment, which affects your cash flow. If you often have to wait more than 10 days past the due date, Direct Debit could be ideal for you. Your money will be collected whenever it’s due, so you’re in control.

What percentage of your customers pay you late at least once a year?

If it’s more than 10%, Direct Debit could help. For those who collect fixed amounts at regular intervals, GoCardless can let you ‘set and forget’ automated payments. The customer doesn't have to do anything and nor do you – payments are automated. You can use Direct Debit for one-off sums too.

Do you take regular or recurring payments from the same customers?

If so, Direct Debit may be the answer. It costs very little in terms of transaction fees, unlike cards or bank transfers. Direct Debit has the advantages of being highly flexible, with a low failure rate and no risk of late payment.

For more information on different forms of payment and how they compare, as well as how GoCardless may be able to help your business, take a look at the GoCardless Guides.