Processing Direct Debit (in the UK) directly or via a third party?

Alicia Lozano

Hello all,

How did you set up the collection of Direct Debit? I got all the knowledge base from RE to process DD with Batch etc…

Which option have you chosen to transfer files to BACS? Are you going through your sponsoring bank directly (which seem costly, time consuming and need to be trained to use the software…) or are you using a third party organisation? How does it work to reconcile payments on RE if you're using a Direct Debit bureau?

I'm really confused about that whole process.

Thank you!

Alicia

Catherine Burns

Hi Alicia. You probably need advice from someone in your country to be sure, but as you have not had any replies yet, then our experience from NZ might help. I have been processing regular giving direct debits from RE for eight years directly through our bank using the following process. I recently provided this info to another NZ based charity…

To run direct debits through your bank you need the file in the correct format for them. Unless the report for that specific bank has been written by Blackbaud then you cannot get the data you need from the direct debit batch, but you can get it from export if you set it up right.

On payment day we create a batch and load transactions due today. We also have an export to export direct debit donations due today, the two are not linked but one of our checks is to make sure the totals are the same. Using the exported data we use an Excel document template to put the data into the right columns required by our bank. This is then sent to our finance team to be loaded to the bank via their software. I have done this myself in other organisations and if the file is in the right format it should not take too long.

Tips to avoid problems

• One limitation of the export is that you cannot export the bank account number from the gift, you need to export it from the constituent relationships tab where there can be multiple accounts. So you need to keep these in sync with the account that is being used on the gift being marked primary, and ideally any other bank accounts should be marked inactive. Hopefully you don’t have any donors with different donations coming from different accounts – if you do you will need to add an account attribute to explain which account is for which date / donation and manually select the right one from the Excel file.
• You cannot export the primary bank only, you need to export multiple bank accounts (as many as the most you will find on any record) but sort them by Primary, Descending so that all those with Is Primary? = YES are in the first column of bank account numbers. You can then ignore all the other columns. I also have queries to find bank accounts that are not marked primary AND not marked inactive to tidy these up before they create issues.
• It takes a couple of days before all the dishonours have been clawed back by our bank, so we don’t know which were successful until then. We actually keep the direct debit batch open, and not committed, for a couple of days because we do not want donations shown as successful before we have received all the results. We commit the batch two days after processing it and then reverse the failed payments immediately unsing an import to update the gift amount to $0 and add the dishonour reason as a gift attribute. While the batch is pending you can see that there is a gift in a pending batch from the gift tab of any donor included in the batch (I use the legend option to make these italics) – this is useful if donors phone to cancel because you see straight away that they have a gift not yet committed and can inform the donor that it is too late to cancel it.
  
  I hope this helps. Let me know if you have questions.

Alicia Lozano

Hi Catherine,

Really appreciate you taking the time to answer and indeed I should have specified it's UK direct debit processing.

Helpful to see the detailed steps - thank you!

Alicia

Rachel Cavalier

This was the big question we had when we switched from our old fundraising software to RE and luckily the switchover period was coincidentally timed for when the Blackbaud Consultant was at our office and could go through the Direct Debit process with us for that month's collections.

We use RE to generate a batch with all the due Direct Debits and were given a program by the Blackbaud consultant to reformat the EFT file we can generate from the batch into the format that the BACS software takes.

We use Accountis for our BACS software and have done since before I started working for our organisation, so I'm extremely vague which of the options from your second question that this could be - but I suspect maybe it's going through our sponsoring bank directly?!?! It's worth it for us because it's not just the fundraising department that uses it.

We did recently set up the ability to collect Direct Debits via CAF as well though. It's been pretty straightforward but saying that, not too many supporters have signed up through that yet and the bulk of our Direct Debits are collected by us directly twice a month. We enter the CAF ones in a batch when they arrive, but I imagine we might need to rethink that process should we end up with hundreds of instructions set up via CAF!