We have improved how Direct Debit works for our customers, in partnership with a payments provider that runs collections through Bacs, the UK system behind Direct Debit. The result is a smoother setup when you take out a loan and clearer handling of each collection, all while keeping the protection that comes built into every Direct Debit: the Direct Debit Guarantee. This article explains what has changed, what the Guarantee gives you, and what to do if a payment is going to be difficult.
Why Direct Debit is our usual method
A short-term Business Bridging Loan is repaid weekly or fortnightly over a few weeks. Remembering each of those dates is a chore, and a missed manual payment can cost you. Direct Debit removes that effort: once set up, the agreed amounts are collected on the dates shown on your Key Information Sheet (KIS), so you can get on with running your business. You always know the amounts and dates in advance because they are set out on your KIS and in your Business Loan Agreement before you sign.
What our payments partner has improved
By working with a specialist Bacs provider, we have made the setup quicker and the handling cleaner. The mandate, which is your instruction to your bank allowing the collections, is now set up as part of signing, so there is no separate paper form to chase. Collections are processed reliably through Bacs, and the records stay accurate on both sides. Where the brief is to make the mechanics quieter and steadier so you can ignore them, that is exactly the point.
If you need to put a Direct Debit in place or update one, the relevant instructions live on our forms page. Keeping your mandate and bank details current is the single best way to avoid an avoidable failed collection.
The Direct Debit Guarantee
Every Direct Debit in the UK is covered by the Direct Debit Guarantee, and ours is no exception. In plain terms, the Guarantee means:
- If the amount or date of a collection is going to change, you will be told in advance.
- If an error is made in the payment of your Direct Debit, by us or by your bank, you are entitled to a full and immediate refund from your bank.
- You can cancel a Direct Debit at any time by contacting your bank, though if it is a loan repayment you should also tell us so we can agree another way for you to pay.
This protection sits with the payment method itself and applies regardless of the fact that our lending to a company is not consumer-credit regulated. It is a genuine safeguard, and it is worth knowing it is there.
If a payment is going to be hard
Cancelling a Direct Debit does not cancel the debt, and a failed collection can lead to further costs, so the worst thing to do is to let one bounce in silence. If you can see that an upcoming payment will be difficult, contact us before the collection date. We would far rather talk through the options early than deal with a missed payment afterwards. Where a company is genuinely struggling, free independent help is available from Business Debtline (businessdebtline.org, 0800 197 6026) and the FSB (fsb.org.uk).
What this does not change
This is an improvement to the plumbing of repayments, not a change to the loan or its cost. The amounts collected are the ones on your KIS; we do not change them without telling you, and we do not quote prices here. You can see current amounts, terms and costs on our business loans page, and your own figures are on your Key Information Sheet.
It also does not change the regulatory position. We lend to companies for business purposes, so this borrowing sits outside FCA consumer-credit regulation under Article 60B FSMA RAO 2001 and is not covered by the Financial Ombudsman Service or the FSCS. The Direct Debit Guarantee, however, applies to the payment mechanism in the usual way.
The honest summary
Smoother Direct Debit setup means less admin for you and fewer avoidable failed payments, with the Direct Debit Guarantee protecting every collection. Set up or update your details through our forms page, keep your bank details current, and if a payment is ever going to be a stretch, tell us before the date rather than after it.
