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Direct Debit Customer Protections

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As Global Head of Content Marketing, Chris oversees all of the content requirements for our organic, growth marketing, and demand generation campaigns. This requires a fundamental understanding of the pain points our customers are experiencing and a thorough comprehension of the ways those customers consume and engage with content. A growth marketing expert in the tech space, Chris has worked with complex global businesses such as Google, AWS, Microsoft, SAP, Adobe, Dell and Oracle to grow their most valuable customers, increase revenue and speed up deal cycles. He has also led on customer lifecycle management programs and account-based marketing strategies for BlackRock, EY, Grant Thornton and UBS. ConnectSee full bio

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As Director of Global Payment Partnerships at GoCardless, Paul and his team manage global relationships with the organisations that make payments work. His expertise was instrumental in building GoCardless' ACH payment product, enabling the company to enter the North American market successfully. Paul sits on the UK Finance Working Group on Open Banking and holds the Chartered Banker, MCIBS qualification. The Chartered Banker Diploma is the highest level qualification awarded by the Chartered Banker Institute, recognised and supported by major financial services organisations across the globe. ConnectSee full bio

Last editedApr 20231 min read

Direct Debit - also known as ACH Debit or bank debit - has protections in place to ensure it's a safe payment method for your customers. Learn about them here.

Both the ACH scheme rules and Federal Regulation E have measures in place to ensure your customers are protected when they make Direct Debit payments (otherwise known as ACH Debits or bank debits).

Your customers can request a return in any situation if they believe the payment was unauthorized, including:

If the customer never authorized payment
If the customer revoked authorization
If payment was processed earlier than authorized
If payment is for a higher amount than the amount authorized
If a corporate debit has been taken from a consumer account

This can help give them peace of mind when paying your via Direct Debit. You can learn about the returns process in our guide to customer protection in the ACH scheme.

How to collect Direct Debit payments with GoCardless

1.

Create your free GoCardless account, access your user-friendly payments dashboard & connect your accounting software (if you use one).

2.

Easily set up & schedule Direct Debit payments via payment pages on your website checkout or secure payment links.

3.

From now on you'll get paid on time, every time, as GoCardless automatically collects payment on the scheduled date. Simple.

Get started in minutes Learn more

How common are returns?

A very low number of Direct Debits are returned, the average is around just 0.2%, although the rate does vary according to the type of business.

High-value goods (e.g. cars), liquid assets (e.g. currency), gambling, and payday loan services tend to be at greater risk of fraudulent returns.

How can I prevent fraudulent returns?

Provide clear contact information and good customer service - This will encourage customers to channel their complaints to you first, before contacting their bank to request a refund.
Send invoices in advance - This gives customers a chance to raise any issues and, if necessary, cancel a payment before it is made.
Follow the ACH scheme rules - Make sure you, or your provider, precisely follow the rules around mandates and timings.

Minimize the risk of returns with GoCardless

GoCardless removes the stress of the payment returns process by helping you manage any returns.

If one of your customers requests a return, GoCardless will notify you, allowing you to review the request and ask us to retake the payment if appropriate. Our processes are designed to minimize the risk of unauthorized returns, and ensure you always abide by Nacha’s scheme rules.

Learn more about ACH Debit payments with GoCardless.