How to Set Up BACS Payments for Your Business (2024)

FAQs

How do I set up BACS payments? ›

How to set up a BACS transaction. You'll need your name and address, your bank's name and address, and your account number and sort code. This could be online, over the phone or you may need to request a physical form from the company. Agree a date when payments will be taken.

There are two options to process Bacs direct credit payments, or “Bacs out”. You either run it through your bank, or you go to a Bacs Approved Bureau to process your Bacs payments. Either way, in order to make a Bacs payment as a business you'd have to sign up with Bacs in one way or the other.

The equivalent system to the UK's Bacs is the Automated Clearing House, or ACH. This network only works within the United States, so you won't be able to send payments to UK clients using ACH. It also only applies to banking rather than debit or credit card payments.

direct debit. BACS direct credit is used by firms mainly to pay their employees and suppliers, while direct debits enable them to draw money from the accounts of customers. Users need only know the bank account details of their counterparty and BACS and the banks do the rest.

What is the difference between ACH and Bacs transfer? ACH is used in the United States, while BACS is specific to the United Kingdom. Their processing times and transaction fees may also vary.

Is Bacs the same as bank transfer? Bacs is the same as a bank transfer and both can be used to mean the same thing. Money is transferred in the standard bank to bank way via the internet or phone banking. The only thing to note is that other types of bank transfers that you may hear about are Faster Payments and CHAPs.

How much does a Bacs payment cost? Bacs payments are one of the cheapest ways for businesses to transfer money between banks. You can expect to pay between 5 and 50p — plus any additional fees charged by your bank — per transaction.

Whilst best known for payments within the UK, it is possible to use your corporate moneycorp international payments account to set up BACS payments in currency for international payroll and other costs such as paying suppliers or overseas office costs.

Direct Debit is the preferred payment method of UK bill payers and it isn't only for household bills, businesses can benefit too by paying their regular or occasional commitments this way.

It only costs a few pence, mostly depending on the volume and the bank, or Bacs bureau. You can typically expect to pay between 5p and 50p per Bacs transfer, plus any additional transaction fees charged by your bank.

What is the alternative to BACS? ›

As the name suggests, Faster Payments is a speedier alternative to BACS. Faster Payments allow you to send money from one bank account to another in just a few seconds, whereas BACS payments take up to three working days. When you use Faster Payments, you don't have to wait for hours or days for the money to arrive.

BACS payments take longer than CHAPS payments to clear and are normally used for low-value transactions (by banking standards, at least). The upper payment limit for BACS payments is £250,000 per transfer.

Most organisations benefit from paying salaries or wages by Bacs Direct Credit – in fact, eight in ten employees in the UK are paid this way.

This is a six character reference that can be found on your Bacs input reports.

Your bank allows you to credit another account using either your personal or your business banking service. You'll need the name of the payee, the name of their bank, the payee's bank account number and the sort code.

How much does a Bacs payment cost? Bacs payments are one of the cheapest ways for businesses to transfer money between banks. You can expect to pay between 5 and 50p — plus any additional fees charged by your bank — per transaction.

Direct Debit is the preferred payment method of UK bill payers and it isn't only for household bills, businesses can benefit too by paying their regular or occasional commitments this way.