An updated version of the Direct Debit Scheme Rules has been released by Bacs. Communications to Service Users are planned for week commencing July 15th. Here’s our overview of the Direct Debit Rules, where you can obtain a copy and what the Rules cover.
What is the latest version?
The documents full name is “The Service User’s Guide and Rules to the Direct Debit Scheme”. The latest version to be released is version 5.7 and it is dated June 2024. It contains 163 pages that cover the obligations placed upon Service Users who operate a Direct Debit Scheme.
This new version replaces all previous versions of the Direct Debit Scheme Rules, the most recent of which was version 5.6, dated December 2022. All Service Users should ensure they have access to version 5.7 and are familiar with the contents.
Where can I obtain a copy?
Relevant documentation regarding the Direct Debit Scheme is available from Bacs or your sponsoring bank. If accessed from Bacs, individuals will need to register and log-in:
- Bacs Information Hub. Documents such as the Direct Debit Rules can be downloaded in PDF format, along with other useful documents such as “The Service user guide – Bacstel-IP” & “Getting Started Guide – Bacstel-IP for Direct Submitters”.
- Bacs microsite. This gives visitors the ability to navigate to the sections of the Rules they need to visit as well as well as downloading a PDF copy.
- Payment Services Website (PSW). This is an online resource operated by Bacs (Part of Pay.UK). Nominated Service User contacts can log-in to:
- view information about Payment Submissions,
- access their Bacs Processing Reports,
- view and maintain information about the organisation and contacts.
- access relevant documentation about the scheme.
What is the purpose of the Direct Debit Scheme Rules?
The intention of the Direct Debit Rules is to standardise the Direct Debit Scheme and its application for all participating organisations. It contains information about how a Direct Debit scheme should operate.
- Mandatory requirements that you must adhere to, are marked as a “Rule”,
- Best practice approaches are marked as “Guidance”.
How can I see what has changed since the last version of the Direct Debit Rules?
Check page 2! Each time a new version of the Rules is released, a handy table is included on the second page highlighting what has changed versus the previous version. This time, the changes all relate to Exception Events and the Indemnity Claim / DDIC process.
What are the changes made in the Rules?
Section 7 of the Direct Debit Scheme Rules has been updated. It reflects the new process with Indemnity Claims. This is where Indemnity Claims raised at Service Users request, and any challenges to Indemnity Claims, should all now be managed via the Payment Services website (PSW).
As a reminder: A Direct Debit Indemnity Claim (DDIC) is raised against a Service User by the payers’ bank for a specified reason.
- If a payer believes an error has been made in the collection of their Direct Debit, they can ask their bank for a refund.
- Their bank will assess the request. If they believe it to be valid, the bank will refund the payer. This is because the bank provides the payer with the Direct Debit Guarantee which is a reassurance that if an error is made, the payer is entitled to a full and immediate refund.
- The bank, now out of pocket, raise a claim against the Service User. They do this under the Indemnity that the Service User signed when taking out their Service User Number.
- The Service User can decide to challenge the claim if they disagree as to the validity of it. Under the new version of the Direct Debit Rules (5.7), if the Service User challenges the Indemnity Claim, they will manage this challenge via the Payment Service Website (PSW)
Where can I read more about the changes?
You can read more about the new process to challenge Indemnity Claims in our blog. This covers what an Indemnity Claim is, what the challenge process is and relevant considerations.
How often are the rules updated?
Typically, the Direct Debit Rules are updated once a year. This year, the updated version has been released mid-year but previously updates have always been issued in January. As a result, we recommend every Service User adds a note in their diary each January to check if a new version is available. Service Users should review the table of amendments on page 2 as this will indicate if changes may be required to processes.
How can I ensure that we are complying with the Direct Debit Scheme Rules?
Our one-day, Direct Debit training courses cover all the Direct Debit Scheme Rules and best practice approaches that a Service User needs to know. Our courses are accredited by Bacs and approved as a source of Continuing Professional Development (CPD) points by the CPD Certification Service. You can see more details about our courses on our training page.
What if I still have questions?
Our team of experts are here to help. If you would like to discuss the Direct Debit Scheme Rules, please contact us.