The Automated Direct Debit Instruction Service (I know, a mouthful, right?), also known as AUDDIS, is a service from BACS which enables organisations to send new Direct Debit instructions to their customer’s banks electronically.
AUDDIS automates the transfer of Direct Debit Instructions from collecting organisations to the paying financial institutions via BACS. The Service User keeps the original signed Instruction and sends the details to the customers’ bank electronically to validate and set-up the Instruction if accepted.
Before AUDDIS, anyone wishing to pay via Direct Debit would be required to sign a physical, paper instruction and post it to their bank. With AUDDIS, Direct Debit Instructions can be set up over the phone or via the internet instead, enabling the use of the paperless Direct Debit service.
So AUDDIS eliminates a lot of the time, cost and effort associated with setting up Direct Debit Instructions for Service Users, their customers and the banks.
Benefits for the Service User:
- Lower set-up costs for Direct Debit Instructions. The automation of the process reduces the need for physical paperwork and manual handling, saving money on administrative costs.
- Enables the Service User to identify invalid account information, as well as any unpaid Direct Debits, for easier reconciliation of successful payments. This ensures that errors are caught early, improving the accuracy of financial records and reducing discrepancies.
- Speeds up the time from a bank receiving and accepting a Direct Debit Instruction, to the collection of first payment; meaning money is received faster. This improved cash flow can help businesses manage their finances more efficiently and meet their obligations promptly.
- Reduces processing delays and manual steps, resulting in a better quality of service. Automation speeds up transactions, which means improved customer service and satisfaction.
- Increases accuracy in identifying a Direct Debit Instruction through a mandatory reference. This mandatory reference helps in tracking and managing payments, ensuring each transaction is correctly attributed.
- Reduces the risk of error, further improving the quality of service. By automating the process, the chances of mistakes are significantly lowered, enhancing overall service reliability.
Benefits for the banks:
- Reduces processing times. The automation of Direct Debit Instructions allows for faster handling of transactions, freeing up resources for other tasks.
- Reduces the potential for error. Automated systems are less prone to mistakes compared to manual processing, ensuring greater accuracy in transactions.
- Minimises paperwork and manual input. This streamlining reduces the workload on staff and cuts down on the time required to manage Direct Debit Instructions.
- Removes paper from the banking system. Going paperless supports environmental sustainability and reduces storage and handling costs associated with physical documents.
- Improves the Direct Debit Scheme, making it a more attractive option to organisations and their customers, making it a more attractive option to organisations and their customers. Enhanced efficiency and reliability make Direct Debits a preferred method of payment for many businesses and individuals
AUDDIS Compliance Reports
AUDDIS reports are available to Service Users and reveal any new Direct Debit Instructions which have been rejected by BACS or by the bank.
Direct Debit Instructions can be rejected for many reasons, but most commonly, rejections are based on the cancellation of the instruction or the bank account being closed. The exact reason will be indicated to the Service User via a ‘reason code’, so it is clear what action needs to be taken.
A typical AUDDIS report will include:
- Service User Number
- Record Type
- Date of Collection
- BACS Reference
- Account Names
- Payer’s Account Number
- Payer’s Sort Code
- Reason Code
What difference does AUDDIS make?
AUDDIS significantly speeds up the time between when a bank receives and accepts a Direct Debit Instruction (DDI) and the collection of the first payment, meaning you receive your money faster. This increased efficiency benefits both Service Users and their customers by streamlining the payment process.
AUDDIS, ADDACS, and ARUDD
The AUDDIS system was introduced alongside the ADDACS and ARUDD systems, which can be summed up as:
ADDACS (Automated Direct Debit Amendment and Cancellation Service): This service manages the automated processing of amendments and cancellations of Direct Debit Instructions.
ARUDD (Automated Return of Unpaid Direct Debits): This service handles the automated return of unpaid Direct Debits.
All three systems are standardised electronic messaging systems, managed by BACS. Companies wishing to use these services directly must apply to BACS and demonstrate that they are capable of sending and receiving these messages correctly.
Practicalities of Using AUDDIS
AUDDIS, ADDACS, and ARUDD are proprietary messaging systems. The ability to use them is managed by their owner, BACS. Companies wishing to use these services directly must apply to BACS and demonstrate their capability in managing these electronic messages.
This requirement means that direct access to these systems tends to be impractical for smaller companies. Fortunately, SMEs can still get the benefits of these systems by using an intermediary service such as AccessPay’s direct debit solution.
Can Any Organisation Apply to Use AUDDIS?
Yes, any organisation can apply to use AUDDIS. However, it is primarily aimed at Service Users collecting low-value, high-volume payments. New Service Users submitting directly to BACS are required to use AUDDIS. Approval is controlled by the banks, so potential Service Users are vetted for compliance with service standards. Once the bank is satisfied that the Service User meets the required criteria, they will be approved to begin using the service.
The Future of AUDDIS
The future of AUDDIS looks promising as it continues to streamline payment data, allowing it to be managed digitally from start to finish. This digital management reduces the need for paper, decreases errors, and improves efficiency for all parties involved.
Paperless Direct Debit Overview
What is Paperless Direct Debit? Paperless Direct Debit allows customers to set up Direct Debits over the phone or via the Internet without needing to sign a physical paper form. This process is faster and more convenient for both the customer and the Service User.
To use paperless Direct Debit, organisations must first have AUDDIS in place. They must also meet certain requirements to gain access to the paperless Direct Debit service. For detailed information on how to get started using paperless Direct Debit services, you can visit the BACS page dedicated to this topic.
How to start using AUDDIS in your organisation
AUDDIS is primarily aimed at Service Users collecting low value, high-volume payments, but is mandatory for all new Service Users submitting directly to BACS.
Organisations looking to get started with AUDDIS start by submitting an application form via their bank and ensuring internal systems, such as software, can accept the new submission and messaging formats.
Approval is controlled by the banks, so potential Service Users are vetted for compliance to service standards.
Once the bank is satisfied that the Service User meets the required criteria, they will be approved to begin using the service.
