Stripe Adds Direct Debit
The FinTech Stripe said it will “create the first self-serve unified payments platform for U.K. businesses” by adding the popular Bacs Direct Debit payments service — which includes digital wallets and card payments — to its ecosystem.
In part, Stripe’s service allows businesses to make and receive online payments. The platform is now offered in 39 countries, 29 of which are in Europe.
Stripe indicated that it can bring some high-tech zest to the 50-year-old Bacs.
Matt Henderson, a business lead for EMEA at Stripe, said that “Bacs is something of a heritage brand. We all recognize the paper forms you fill out to set up the mandate. It’s rightly trusted, but can feel a bit old-fashioned.” He added that Stripe is “pleased to be able to bring Bacs Direct Debit completely online alongside newer payment methods like Apple Pay or Alipay.”
Henderson said that “the ability to collect Bacs payments will help increase conversion, reduce cost and minimize churn.”
San Francisco-based Stripe said that its partnership with Bacs — which sees over four billion payments made via Direct Debit annually — “means businesses can now easily accept one of the U.K.’s most trusted payment methods entirely online, and in the same platform as their card and digital wallet payments.”
U.K.-operated Bacs recently partnered with U.K. challenger bank Metro Bank and Boston payments firm Bottomline Technologies to enable direct debits for small to medium-sized businesses (SMBs), as reported by PYMNTS.
Stripe said that FreshBooks plans to use the new Direct Debit linkup to power its upcoming launch into the U.K. market. Stripe also plans to target the nonprofit fundraising market. Direct Debit already processes millions of dollars in charity donations, Stripe said. Now, nonprofits will be able to use platforms like Chuffed to set up recurring donations by hooking up with Stripe’s new offering.
Prashan Paramanathan, CEO of Chuffed, said: “Recurring payments are particularly important for charitable causes that need to turn moments of emotional connection into long-term sustained change. Now that charities can collect Direct Debits online alongside card payments, they generate more long-term funding for their causes.”