If you’re a member of a large business then you are probably already paid by bacs. In fact, most or all of the accounts will be operated this way, since BACS payments are fast, secure and simple. The acronym stands for Bankers Automated Clearing System, and essentially means electronic payments. When you log in to online banking and send money to someone else, or pay a bill, this is mostly done by BACS (a variation is SWIFT, which is the same except that the payment goes through on the same day rather than in three working days; it does, however, cost extra). Many medium and small businesses do not use BACS software for their accounts, preferring to stick with cash and chequebooks. It may simply be that the firm was started before BACS became common, and the accounts department never updated their methods. Either way, upgrading can be a good way to streamline your finance department.
BACS has a number of advantages over the old-fashioned way of doing things. For starters, it means you don’t have to keep a lot of cash on the premises, since on payday the money automatically goes to people’s bank accounts. If you’ve been working by cheque, this is a step in the right direction, but it is still subject to error and other problems – not to mention the pain of making out a separate cheque for the correct amount to every employee. BACS software can be integrated with your accounts software, so the right amounts are calculated for you. This can save a massive amount of time, and avoids most errors you might make – as well as delays. Even if a cheque takes no longer to clear (which is not always the case – BACS varies and some payments seem to go through very quickly), people still have to pay them into the bank. If you’re pushed for time, a cheque can sit around for days or weeks before you get around to it.
There have been lots of news stories in recent years about the disappearance of the chequebook, as cards become more and more popular. Like cards, BACS is fast and secure – another reason to expect that the cheque will soon become a thing of the past. BACS software therefore has a number of advantages over the alternatives and is well worth considering if you don’t have it already. bacs payments have well established themselves over recent years for good reason.
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