How to Set up Direct Debit for Business and Customers

Team Nomi

May 25, 2026
6 minutes read

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Setting up direct debit for business makes it easy to collect recurring payments automatically from your customers’ bank accounts. It’s a simple way to keep cash flow steady and predictable without manual follow-ups.

Direct debit works well for both sides. For direct debit for businesses, it reduces late payments, cuts admin time, and improves cash flow planning. Customers enjoy the convenience of automatic payments and built-in consumer protection.

You can set it up through your bank or a specialist provider. Either way, you’ll need customer authorisation when setting up direct debit for customers. Once it’s live, payments are collected automatically on the agreed dates, so you can focus more on growing your business and less on chasing invoices.

How to set up Direct Debit for your business

Setting up direct debit for business is a straightforward process that can be accomplished in a few key steps:

Choose your setup method

You have two main options: going through your bank or using a third-party direct debit provider.

Obtain a Direct Debit Instruction (DDI)

The DDI is the legal agreement that allows you to collect payments from a customer’s bank account when setting up direct debit for customers.

Set up customer payment details

Once authorised, you’ll input the customer’s bank account and payment information into your system.

Notify customers of the first payment

Before any money is collected, you must notify customers of the upcoming first payment date and amount.

Submit payment files

On each scheduled payment date, submit payment instructions to your provider.

Automate notifications

Set up automated notifications to alert customers ahead of future payments.

How to set up Direct Debit for my customers

If you’re wondering how to set up direct debit for my customers, the process is simple and effective:

Choose a Direct Debit provider

Start by deciding whether you want to set up direct debit through your bank or use a third-party provider. Many businesses choose third-party platforms because they simplify direct debit for business and reduce manual work.

Send advance notice to customers

Before collecting any payments, inform your customers that you’ll be setting up direct debit for customers. Clearly explain how direct debit works, when payments will be taken, and the benefits, such as convenience and on-time payments.

Obtain customer authorisation

You must receive explicit permission from customers before taking payments. This is done through a Direct Debit Instruction (DDI), which can be completed online or on paper. The mandate is a legal requirement and protects both you and your customers.

Set up customer payment details

Once authorisation is received, enter the customer’s bank account details into your direct debit system. Make sure all information is accurate to prevent failed payments or delays.

Schedule payment dates

Decide how often payments will be collected, monthly, quarterly, or on custom dates. Choosing consistent payment dates makes direct debit for businesses easier to manage and helps customers plan their finances.

Send payment reminders

Although payments are automatic, it’s good practice to notify customers before funds are collected. Advance reminders improve transparency and reduce disputes or payment issues.

Automate the process

Once everything is set up, payments will be collected automatically on the scheduled dates using direct debit for business. This removes the need for manual invoicing and follow-ups, saving time while ensuring reliable cash flow.

If you’re looking for a direct debit payment provider for your business in UK, NomiPay is an excellent choice. NomiPay specialises in direct debit solutions, offering a user-friendly platform with robust features.

Features of Nomipay

NomiPay offers a complete payment solution that combines direct debit, instant payments, and automated bookkeeping to streamline your billing process and improve cash flow.

NomiPay Direct Debit solution

• Collect payments directly from customers into your payment wallet via invoices
• “Pay Now” button on invoices for customers to pay immediately 
• Set up automated direct debits for recurring invoice payments

Comprehensive dashboard

• View all accounts receivable from different customers in one place
• Track daily payouts and funds in your payment wallet

Pay now button

• Customers can click to make instant payments 
• Support for debit/credit cards, Apple Pay, Google Pay, and internet banking

Automated Direct Debit

• Set up one-time or recurring direct debit payments on invoices
• Payments are automatically collected on the due date

Get paid faster

• No more waiting or chasing customers for payments
• Direct debit and “Pay Now” options ensure timely collections

Automated Bookkeeping integration

• Seamless integration with accounting/bookkeeping software
• All payments are automatically recorded and synced

Save time on admin

• No manual data entry required
• NomiPay handles payment tracking and reconciliation  

Better customer experience

• Direct payment options are convenient for clients
• Shows you value their time and needs

Maximum security

• Stringent security protocols – 3DS, PCI, and PSD2 compliant
• Partner with UNIPaaS for a secure payment experience

Cost-Effective pricing

• Zero setup cost
• No monthly fees
• Automated bank reconciliation included

NomiPay customers rave about their exceptional customer support. The team provides hands-on assistance through setup and ongoing guidance as needed. 

To experience the NomiPay difference for yourself, start with their 30 days free trial. See firsthand how our direct debit solution can make your billing easy and improve cash flow.

Frequently asked questions

1. How does a company set up a direct debit?

Ans: A company sets up a direct debit by choosing a bank or direct debit provider, collecting customer authorisation, and scheduling payment dates. Once approved, payments are collected automatically from customers’ bank accounts.

2. Why switch direct debit providers for businesses?

Ans: Businesses switch direct debit providers to reduce costs, access better automation, improve reporting, or integrate with accounting software. A better provider can make direct debit for businesses faster, easier, and more reliable.

3. How to collect direct debits from customers?

Ans: To collect direct debits from customers, you must first obtain their authorisation through a direct debit mandate. After approval, payments are automatically taken on the agreed dates without manual follow-ups.

4. How do I set up direct debits for my customers?

Ans: If you’re wondering how to set up direct debits for my customers, start by choosing a provider, sending an advance notice, collecting authorisation, and entering customer bank details. 

5. What do you need to set up a direct debit?

Ans: To set up a direct debit, you need a direct debit provider or bank account, customer authorisation, accurate bank details, and clear payment schedules. These are the basic requirements for setting up direct debit for customers.

6.How to take direct debit payments from customers?

Ans: To take direct debit payments from customers, get written or online approval, set up payment instructions with your provider, and collect payments automatically on the agreed due dates.