AUDDIS Migration: When, Why and How?

Over the years we have supported many Service Users undertaking AUDDIS Migrations. We have provided advice and guidance for some; full project management for others and have even been called in half-way through to rescue an AUDDIS Migration that has gone wrong!

Usually an AUDDIS Migration is something an organisation will only undertake once so its not easy for Service Users to gain any experience in the area or to fully predict all the possible beartraps. That’s where we can help! We urge any organisation looking to undertake a Migration to get in touch. Every AUDDIS Migration is different and we will work with you to ensure yours runs smoothly.

What is AUDDIS?

Direct Debit is a hugely popular means of collecting regular payments from your customers / members / donors. The traditional paper-based Direct Debit system has many advantages over other payment methods – but as an organisation grows, sending paper Direct Debit Instructions (DDI’s) to the banks can become cumbersome.

AUDDIS stands for “The Automated Direct Debit Instruction Service”. It was introduced in the late ‘90s to allow service users to submit DDI’s to BACS electronically. As organisations have moved over to AUDDIS, they have seen the advantages of a system which:

• Reduces processing costs and set up time (no waiting for DDIs to be posted)
• Offers increased accuracy – if the AUDDIS instruction fails to lodge you will find out via your Bacs AUDDIS report – whereas with a non-AUDDIS system you do not find out until the collection fails
• Eliminates paper – which in turn can reduce errors
• Allows you to accept one-off Direct Debits and ultimately Paperless Direct Debit instructions (PDD)

How can an organisation introduce AUDDIS?

Approximately 45% of Service Users continue to operate a paper-based system of submitting their Direct Debit Instructions to Bacs, i.e. they send them in the post. If an organisation wants to use AUDDIS instead there are a number of options and the best approach will be different for different organisations. It will depend on factors such as:

• the number of existing customers signed up by Direct Debit,
• the amount and frequency of collections,
• whether the organisation plans to introduce a Paperless sign up system, i.e. using telephone and internet sign up
• the administrative resource available to support a system change.

These options for introducing AUDDIS include:

• The company can move all of the existing DDIs to become AUDDIS instructions, by migrating their Service User Number. This is a typical approach and currently 6.5% of all Service Users are in the process of Testing or conducting an AUDDIS Migration.  It can appear daunting as it requires a series of technical and complex steps be conducted in the correct sequence, however it can help streamline your processes once implemented. For most organizations it is a process they will only complete once and gaining all the necessary knowledge and skills can be a time consuming and therefore costly process.  Outside help however can ensure that the process is conducted smoothly and efficiently, thereby negating these possible issues. As part of our Direct Debit Consultancy we can help you weigh up the advantages and disadvantages of each approach; implement the best way for your organisation to migrate to AUDDIS; support you through the ‘test’ phase; introduce you to software suppliers if appropriate and support you beyond the migration, offering follow up support, without the need for you to have an ‘in house’ expert.
• The company can set up a new Service User Number which is already enabled to submit via AUDDIS and stop using their old Service User Number. This approach requires a company to contact all existing customers and request new Direct Debit Instructions, running the risk that some customers will refuse.  It can be time consuming and can require system changes, however for organisations with relatively few existing customers it can be simpler to undertake than a migration.
• A company can operate 2 Service User numbers in conjunction.  One SUN would be AUDDIS enabled and used for new customers and the other would be the existing non AUDDIS enabled SUN – used for existing customers.  Although this could sound confusing it can be very simple in practice.  All new customers are signed up using the new SUN, allowing an organisation time to develop experience of the new process.  The usage of the existing SUN would reduce over time which could be appropriate in some businesses, especially those with high natural customer turnover.
• Remaining on a fully paper based DDI system. Although an enforced move to using AUDDIS has been discussed, there are no current plans by Bacs to implement this.

What is involved in an AUDDIS Migration?

There are a number of steps involved in an AUDDIS Migration and the speed at which an organisation moves through these will depend upon their knowledge and resources. Briefly, these are:

• Application – including details of your processes for Modulus & KYC checking etc.
• Preparation – obtaining the correct data and in the correct format. If not, you may need to procure additional software.
• Testing – you must demonstrate to Bacs & your sponsoring bank that you can correctly submit AUDDIS files.
• Go Live – converting your existing DDIs to AUDDIS. You will no longer be able to submit manual (paper) instructions once your Service User Number has been migrated.
• Follow up & Reconciliation of failures.
• Next steps – Implementing AUDDIS is necessary before you can introduce Paperless Direct Debit.

Common pitfalls when conducting an AUDDIS Migration

Every AUDDIS Migration is different but broadly, the most common issues we see include:

• Timing – It’s important to ensure that you conduct your testing and send live conversions according to an agreed timeline with your bank and allowing plenty of time for ongoing collections to not be affected. This is more of an issue if you collect every day which might require you to split the Migration.  It’s also important to ensure you don’t submit live files until your LIVE date and that you stop submitting paper instructions in good time.
• Reference numbers. With a paper based Direct Debit system you can have reference numbers as short as 2 characters. If you are using AUDDIS these need to be at least 6 characters and this change needs careful consideration. Also, if there is one thing to check, check and check again it’s that you submit the correct reference numbers as part of the migration to ensure that future collections can occur successfully.
• Data issues. Ensuring your dataset is clean can often be a challenge. You will need to identify live accounts, remove accounts that no longer exist, update sortcodes & account names / numbers etc. Even then, there will be some accounts that won’t allow AUDDIS. Dealing with these issues is part of the testing process and should be undertaken wherever possible before the live submission.
• Customer liaison. When updating your customers about any changes – such as reference numbers / timings etc, its important to get it right and protect your organisational reputation. We can help with advice and templates.

Interested to learn more?  Get in touch

If you are considering migrating to AUDDIS, Clear Direct Debit can help. You can contact us by e mail, phone or via our website. We look forward to helping!