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With the end of the financial year fast approaching, most companies will be looking at their operations and suppliers in preparation for the new tax year budgets.
If this is the case for you, now might also be the right time to review your regular payment processes and how they’re managed.
It’s easy to assume that once Direct Debits are being processed there’s little more you can do to improve your regular income stream.
However, there are several factors to consider that can help you both optimise your processing and get most value of your regular income, whether that includes Direct Debits for donations, lottery plays, membership fees, etc.
Here’s a quick checklist to help your review:
Are you receiving your payer’s first Direct Debit payment as quickly as possible? Workload pressures on in-house teams can see Direct Debit management pushed down the priority list – but if you’re not actively optimising the speed of that first payment, you could be missing out on significant revenue.
The way consumers manage their payments is changing as social behaviours and technologies evolve, so providing a choice of ways to pay will keep you one step ahead.
This could be the array of collection methods you offer (such as online, mobile and in-app), or flexible options that enable choice from multiple collection dates, weekly payments, or payment holidays.
Is your inhouse team overloaded? Do you have enough expertise in place? How easy it is to work with your outsourced partners?
If you work with multiple third parties, e.g. external lottery managers plus a Direct Debit bureau, do they work well together or are you having to be the middleman?
Consider your procedures in the event of human error, staff sickness, lack of in-house knowledge, and of course disaster recovery – what will happen in the face of transport strikes and snowfall disabling your workforce, or theft, fire or flood? In-house or working with an outsource partner, are there sufficient plans in place?
How do you keep abreast of latest trends, technology and practices? And if you outsource, how current are they?
For example, are there new innovations that could add value to services, passing along cost savings or income increases, and are you or your partner aware of them, and actively investigating their potential?
If you process Direct Debits in-house, you may want to explore what you could gain by outsourcing to a third party.
It’s worth weighing up the investment against the potential gains: the expertise, experience and systems a processing partner would provide, and the additional time and potential productivity your in-house team would gain that could be invested back into core business priorities like marketing and fundraising.
If you already outsource, it is good practice and good business sense to regularly review these arrangements too, to check they are still fit for purpose and competitive in terms of pricing and quality assured services, for additional peace of mind, it’s worth looking for industry kite marks like ISO.
Much has changed in the regulatory landscape particularly with GDPR, so it’s also worth checking that your supplier’s data security processes are compliant, and their Direct Debit services BACS audited and approved.
With just over a month to go until April 6th, it’s certainly a good time to review your regular payment processes to make sure you’re in the best position to enter 2020/21.
Get in touch today if you would like further advice or help in reviewing your Direct Debit processing.