An automated bank payment is a transfer of money from one bank account to another, without the need for a paper transfer document such as a cheque. Automated payments are often more convenient than paying by cheque. Standing orders and direct debits are common forms of automated payment. Another is BACS.
BACS stands for Banks Automated Clearing System. It is a system for making payments between bank accounts of different banks that reduces the amount of paperwork and effort required.
BACS is used:
It is possible to instruct a bank to make BACS payments using a paper instruction, called a BACS payment listing. An example is shown overleaf.
74 High Street, Bristol B54 7DX Sort Code 80-24-18
Payment ref:
Name of customer:
BACS:
ABC Trading Ltd
Downland Road
Twyford
Berks
27446879
Date:
Authority is hereby given to National Southern Bank to make the following payments by BACS transfer from the account designated above.
| Payee | Sort code | Account number | Amount £ |
|---|---|---|---|
| Total | |||
Please make these payments as soon as possible and debit our account with the total shown above
Authorised signature
Date
Most businesses send the instructions by computer disk to a BACS reception centre, or by electronic communication. This electronic data is then processed at a BACS processing centre, and the payments are then made automatically through the banking system.