As technology advances, new ways of making payments become easier to use. In some cases, using a credit card isn't the smartest way to make a purchase or payment. This is where direct debit comes in – an electronic, and in some cases automated, payment method. With direct debit, the merchant is able to pull money for a payment directly from the customer's bank account. This process sidesteps some of the procedures that are required when a credit or debit card is used, making direct debit transactions more efficient. 

How it works
Direct debit operates without coming into contact with any card processing companies and works specifically with banks. The customer authorizes the merchant to pull money from their checking account to pay for goods and services. To make these payments, customers typically need to provide their name, address, bank name, bank address, account number, and routing number, accourding to Direct Debit, a payment information site.  Needed information may vary depending on the country the customer lives in and the country the merchant is located in. The retailer should make sure to request the right information to ensure the payment is made. 

Why use direct debit
Because the payments don't deal with credit card companies, they are processed at a much lower cost, making direct debit payments attractive to retailers. In addition to the low cost of processing these payments, direct debit can also lead to better customer retention rates. Card information expires, and unless a customer remembers to update their payment information, the retailer won't get paid. This is especially important when it comes to recurring payments, one of the best situations for direct debit payments. 

When recurring payments are made with direct debit, the customer only has to input their information once. Subscription-based companies can benefit greatly from the constant and consistent payments that come in through this method. It makes paying for the subscription as easy as possible for customers.

Another thing that's great about direct debit transactions is they can be easily made by anyone with a bank account. Businesses, organizations and individuals can all benefit from the smooth and simple process of direct debit transactions. And direct debit is applicable for everything from buying clothing online to paying taxes, making it an extremely useful tool. Any store or organization that accepts electronic payments should consider adding direct debit to their avaliable payment options. 

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