In this guide, we walk you through options for accessing BECS Direct Debit.
For businesses wishing to collect payments via Direct Debit, there are three possible routes to choose from.
Direct access via your bank
Submitting indirectly via online Direct Debit provider, GoCardless
Direct access via your bank
This option gives you the ability to manage your Direct Debit payments in-house. It’s normally better suited to large businesses rather than small ones, due to scheme requirements, complexity and cost.
To use this route, you’ll need to apply directly to your bank for your business to become a Direct Debit initiator. If the bank approves your application, you'll be given an authorisation code, and your business will then gain the ability to submit Direct Debit payments directly through your authorising bank.
New Zealand has three Direct Debit service options for direct access. These differ mainly in the format and submission process of the Direct Debit mandates. Here are the details of each one.
Standard Service. The initiator (that’s the biller/your business) receives a signed approved authority form from the acceptor (that’s the payer/ your customer). As the initiator, before you can start taking any payments from customers, you must first send this paper form to your bank, where it will be processed against the acceptor's bank account.
Preferred Service. In the second option, a preferred initiator gets a signed approved authority form from the acceptor and retains it. When the first Direct Debit payment is taken, the acceptor's bank will automatically load the initiator’s authorisation code against the acceptor's bank account.
Paperless Service. In the third option, a paperless initiator gets an instruction (via online or phone) from the acceptor (instead of using the approved authority form). The paperless initiator must then confirm in writing to the acceptor. This must include the original instruction, along with the standard terms and conditions. Then, when the first payment is taken, the acceptor's bank will automatically load the initiator’s authorisation code against the acceptor's bank account.
Paperless initiators have a number of additional requirements. Firstly, the sponsoring bank must be confident that a potential paperless initiator fully understands the acceptor's (customer’s) right to claim back Direct Debit payments. The paperless initiator must understand and be able to manage any liabilities or risks (customer claims) that may occur while using the Direct Debit scheme.
Using the direct access route has heavy requirements and can be quite complex. Many businesses instead prefer to go down the indirect submission route. In this option, you’ll use a third party (such as GoCardless) to handle the complexities of setting up and managing Direct Debit payments on your behalf. These companies are often known as Direct Debit processors or providers, although they may also operate under other descriptions.
Direct Debit processors
Online Direct Debit specialist GoCardless can manage the whole payments collection process on your behalf. You can keep track of your payments using an online dashboard, or alternatively integrate GoCardless with your own setup using a REST API.
GoCardless differs from other New Zealand Direct Debit processors because it enables you to collect payments not only from within New Zealand, but also from a wide range of international locations, including Australia, the UK, and Europe.
GoCardless also offers simple and transparent pricing with no setup charges or hidden fees. To find out more about collecting Direct Debit payments with GoCardless, or simply to register your interest, check out our GoCardless New Zealand page.