The easy answer is if you’re collecting thousands of payments a month it may work out cheaper in the long run to manage the payments process in-house with your own SUN. However, even if you are collecting a lot of payments, the time and effort saved by using a third party SUN may make it the right choice for you.
To help you find your best option we’ve put together this quick 6 question quiz:
1. Do you need your name (and only your name) to appear on your customer’s bank statement?
A Yes. If the answer is yes then having your own SUN is your only option.
B No. Using a third party’s SUN, the provider’s name will always appear on your customer’s bank statement. With some providers your name will also appear but usually after the provider name.
2. How many payments will you be collecting?
A More than 1000. Using your own SUN, cost varies depending on the number of payments you’re collecting. If you submit 1000s of payments each month fees can be as low as 15p per payment making using your own SUN your cheapest option.
B Less than 1000. If you’re taking less than 1,000 payments a month it will probably be cheaper to use a third party’s SUN. The cost will still vary depending on the provider and any scale pricing they offer (details of GoCardless’s pricing can be found here).
3. How much time do you have?
A Lots. Getting your own SUN can take up to 8 weeks through a bureau and as long as 6 months through a bank.
B Not much. If you’re short on time you’ll need to use a third party SUN – with most bureaus it takes around 4 weeks. With GoCardless it’s instant!
4. How much do you want to spend on getting set up?
A The sky’s the limit. Setting up your own SUN can be an expensive business – costing up to £15,000 a year to collect payments in-house. While you can recoup these costs if you collect a high volume of payments, unsurprisingly, a lot of businesses are put off of Direct Debit for this very reason.
B As little as possible. Using a bureau the costs are a little less eye watering with your own SUN costing around £500 - £800 and a third party SUN around £400. With GoCardless, it’s completely free so you can use your hard earned pennies elsewhere.
5. Have you been sponsored by your bank?
A Yes. Well done - one of the hardest parts is over for you, making your own SUN a much more viable option.
B No. Getting sponsored by your bank for your own SUN can be a challenging process – you'll need to meet with your bank, submit a business plan and apply to their credit and risk teams to check that you meet certain criteria. For details see our guide to becoming a Direct Debit originator but some of the more taxing requirements include:
A minimum revenue of at least £1m.
A bond of £50-500k.
Using a third party SUN is considerably less onerous: GoCardless carries out address and identity verification checks but anyone can sign up, regardless of their revenue or business plan.
6. How much time do you want to dedicate to the payment process?
A As much as it takes. Using your own SUN collecting payments is a substantial task – you’ll need 1-3 FTEs depending on the size of your business, special BACs approved software and, what’s more, your staff will need regular training on the Direct Debit scheme rules and how to use new software and processes.
B As little as possible. With a third party’s SUN, your admin can be kept to a minimum – particularly where a provider offers online, automated payments. Since switching to the GoCardless SUN, Greater Anglia have saved 26 hours a month while Grow Wild, reduced their admin by 97.5%.
If you've answered mostly As then having your own SUN may be the best option for you. If, on the other hand, you've got more than a sprinkling of Bs, using a third party's SUN is probably the right choice for you.
If you're still not sure or you'd like to find out more about getting access to the Direct Debit scheme check out our beginner's guide to becoming a Direct Debit originator.