Bacs, or Bankers’ Automated Clearing Services, is a British scheme for the electronic processing of financial transactions. Taking a normally fairly long-winded process and making it fail-safe, reliable and very efficient, the bacs software revolution has proved highly useful for many organisations. Making use of bacs payments takes much of the hassle out of dealing with debits and credits, meaning that staff can devote more time to more important, skill-based tasks.
Bacs payments are particularly useful on account of their guaranteed efficiency in terms of speed. A payment made through this method will take three working days to clear. According to the method, they are entered into the system on the first day, processed on the second day, and cleared on the third. Developed as far back as 1968, the technology was intended to allow for the electronic transfer of funds between banks, and abolish the need for paper documents as part of the money transfer process. The first company that set up the service was called ‘Bankers Automated Clearing Services Limited’. This system was developed in 1983 by the introduction of a telephone service, BACSTEL, which reduced the need for magnetic tapes. The popularity of the system increased during the 1980s, and more banks and building societies joined in 1985, when the company shortened its name to ‘Bacs limited’. Bacs Payment Schemes Limited split from Bacs Limited in 2003, creating a separate not-for-profit body with members from the banking industry which promoted the use of automated payment schemes and governs the rules of the scheme.
Since 2003, Bacs has been moving from the telephone dial-up service to an internet-based service, which is quicker and more secure. All bacs users were at this point required to move to the internet service by 2005, or return to using cheques. At the moment, it is only possible to make a connection with software from the list of bacs-approved solution suppliers. While it may sound like there are stringent requirements for the use of this technology, it is actually fairly straightforward to set up. Once it is in place, the payments system is so straightforward that the installation effort is likely to be seen as worthwhile.
In fact, bacs is so efficient that many businesses will assume that any monetary transfer will be done using bacs software. Once you become accustomed to using bacs payments, your payments systems will be so efficient that you should never have to be concerned about a delayed money transfer ever again.
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