making multiple BACS payments

[neilsolaris]

Hi,

I'm going to be taking over the bookkeeping of a company soon, and one of the responsibilities from time to time is to make multiple BACS payments for up to 80 self-employed individuals. Up until now, the current business owner has paid a third party to carry out the BACS payments, but it seems quite expensive (I can't remember exactly how much). Is there any reason I can't do it manually myself to save the business money, or better still, once I have everyone's bank details set up on a spreadsheet or accountancy programme (such as Sage), is there any way I can pay everyone in one go?

Many thanks for your help.

 

[WaveJumper]

Have you asked the company why they are using a third party service

 

[neilsolaris]

I'm visiting their accountants on Friday, so I'll ask them then. I was just hoping to find out some info in the meantime.

 

[Scalloway]

One point to consider is how much will it cost for you to do it yourself. How much work is involved in you preparing the submission and processing it. It could well be that the business considers it more cost effective to get somebody else to do it.

 

[Graham Tyers]

You'll need a BACS originator number to do it properly yourself - or you can use a Bureau and use their account (for dollars). BACS has to be sponsored by your bank, as the liability is unlimited by time and amount.

Your bank will likely either charge per BACS file submission - say £5 for submitting a file with your 80 lines on it, or will allow you submit a file for free and you will then pay 20p, 30p,40p or somesuch per BACS transaction.

You then need a BACS processor to shuffle the file into the black hole that is BACS for a fixed monthly cost. Not much, can't remember how much I pay.

BACS setup was £250 the last time I did one. You need to do a bit of back and forth but it's pretty straightforward. I've done it a few times so shout if you need a hand.

 

[neilsolaris]

Thanks a lot everyone. And thanks I_DO_MARKETING, that's very useful advice. I'll have a look into that, and I might very well come back to you. That's certainly a lot cheaper than what the third party was charging, so I'm sure I can save them money, even considering my fee.

 

[Graham Tyers]

I like BACS, and use it for Direct Debit collection of customer payments and subscriptions as well as for the payroll and paying suppliers.

To do the job properly you need a bit of programming to automate it nicely, but once it's set up it's very low maintenance.

Direct Debit customers tend to pay more and stay on board longer too. Once the instruction is in place it just works. So if you are in a business where you are collecting subscriptions or regular payments from customers I'd certainly use it over and above credit cards which will work out much more expensive.

 

[neilsolaris]

Thanks again. I'd better not give too many details about exact nature of the business, but I think there will mostly be one off large receipts, which will quickly be dispersed to the multiple individuals. So it's mainly the payments that will occur in large quantities.

 

[SERC1204]

The simplest way I've seen this done is by directly importing the "payment run" into the banks online system.

You extract a report from the system that contains all relevant information (payee name, sort code, account number and value), saving it in the correct format (Note, Excel/csv etc.) and then uploading to the bank. The payment/s can then be authorised in the usual way. If you have the details in Excel, this may be possible too.

This does of course depend on bank/accounting system compatibility and you sometimes need a little work around - a system I used previously used to give all values in the format 000000.00, so £756.31 would come out as £000756.31, but the bank wouldn't recognise £ or the pre zeros so we had to remove these manually through find and replace.

 

[neilsolaris]

Thanks a lot SEEC1204, that sounds perfect. When I'm in possession of the files I'll see if I can make it work. I'll probably come back later for more advice!

By the way, is it free to do online payments in the way you described? Thanks again.