Direct debit is a payment method that allows a company to withdraw funds from a payer's bank account. It is also known as automatic transfer, authorized withdrawal, or ACH debit. Payers authorize the company to collect payments from their account, typically for recurring bills or subscriptions. Direct debit is a popular and convenient way to make regular or recurring payments, providing benefits such as convenience, cost-effectiveness, and continuity. However, it's important to provide specific authorization and be aware of the rules and notifications associated with this payment method. Direct debit is not suitable for one-off payments where instant fund transfer is needed, such as in e-commerce transactions
. Direct debit is widely used for various purposes, including paying regular bills for variable amounts, fixed subscriptions or memberships, and spreading costs for one-off payments. It simplifies the billing process, reduces the risk of late or missed payments, and is particularly beneficial for recurring payments such as subscriptions
. To set up a direct debit, the payer usually needs to provide their bank account number and sort code, and specify the date for the payment to be taken. Direct debits can be canceled at any time by contacting the bank or using mobile and online banking, with the bank being required to refund the payment if it's taken after the cancellation
