Direct Debit hits half a century

It may not be an entry in too many people’s diaries, but this year represents a golden milestone for Direct Debit, as one of the most familiar payment methods in the UK turns 50.

Pay.UK, the operator of the UK’s Direct Debit scheme are marking the 50th year of operation in the UK – read Pay.UK’s tribute to Direct Debit:

A trusted brand

A trusted brand, which has become synonymous with ensuring bills are paid reliably and without fuss, it is perhaps apt that the milestone is marked in a typically understated way, reflecting Direct Debit’s role in quietly moving £1.3 trillion behind the scenes, each year.

A quiet revolution

With Direct Debit part and parcel of everyday life, it’s easy to forget that when it was launched in 1970 – a year that saw the first music festival held at Glastonbury – it represented a quiet revolution of its own. Put simply, the world of bill payments was changing.

Today, Direct Debit – which is owned and run by UK retail payments authority, Pay.UK – is relied on by thousands of service users to reliably collect funds, and has a half-century of continued year-on-year growth. 

Payments without fuss

Part of the growth in Direct Debits, inevitably, is down to the many more bills we pay today.

In the 1970s, regular  payments were limited to mortgage or rent, and electricity or gas. Nowadays, we have mobile phone bills, broadband bundles, gaming subscriptions, in-app payments, and half a dozen different types of insurance; we spread the cost of major purchases from holidays to cars, and more mundane ones such as our TV licence or Vehicle Excise Duty, and settle dual fuel, water, and council bills without ever having to leave the house.

We need payments to work without fuss so we can get on with the important things in our lives. During this unusual, difficult year, Direct Debit has continued to run quietly, securely, and reliably in the background, as it has in the past 50 years, collecting payments for billers and giving customers peace of mind that the services they need and want are being paid for with the minimum of effort on their part.

Maha El Dimachki,
Pay.UK’s Chief Payments Officer

50 years of growth

The importance of Direct Debit to businesses and individuals in the UK has been demonstrated by 50 years of continued growth.

Source: Pay.UK


50 years on a Direct Debit has certainly become the embedded, hassle free, frictionless and pre-eminent way of making recurring payments.

It was my privilege to lead Bacs as its CEO for over a decade – a time in which Direct Debit volumes grew from circa 2 billion to just over 4 billion transactions per annum.

Now under the guardianship of Pay.UK, Direct Debit has reached both a time and volume milestone demonstrating that DirectDebit is truly embedded within the UK’s payment mix.

Given its importance in the UK’s payment mix it is not surprising to see that Pay.UK remain committed to ensuring that Direct Debit will be here for some time to come.

And we are determined that will remain the case for as long as end users need and value it. Our team continues to work hard to ensure the service operates smoothly and efficiently, this year and in the years to come.

Maha El Dimachki,
Pay.UK’s Chief Payments Officer

However, the next few years will see a payments revolution:

  • Direct Debit will be encompassed within the proposed New Payments Architecture and will have to consider issues such as the introduction of ISO20022, bulk vs one by one file submission and unpack the pros and cons of push vs pull payments.
  • Complimentary and sometimes competing payment options such us the new Request to Pay service (RtP) will become part of the UK’s payments mix.
  • Open Banking will begin to truly embrace payment initiation and develop new payment options such as Variable Recurring Payments and sweeping options.
  • Recurring card payments are becoming easier to remember and control through banking apps.

My time as Bacs’ CEO represents a very significant part of my career and I am proud to have played my part in the success of Direct Debit.

I look forward to seeing Direct Debit continuing to meet the needs of consumers and businesses for many years to come as part of a vibrant, innovative, complimentary and competitive payments mix.

Happy birthday Direct Debit!

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