BACS
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| Founded | 1968 |
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| Website | www.bacs.co.uk |
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Formerly called
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Bankers' Automated Clearing Services |
Bacs Payment Schemes Limited (Bacs), formerly known as Bankers' Automated Clearing Services, is the organisation with responsibility for the schemes behind the clearing and settlement of UK automated payment methods Direct Debit and Bacs Direct Credit, as well as the provision of managed services for third parties. These include the Cash ISA Transfer Service, Biller Update Service and the development, management and subsequent ownership of the Current Account Switch Service.
More than 120 billion transactions have been debited or credited to British bank accounts via Bacs since its inception; in 2016, 6.22 billion UK payments were made this way, while a new record was also set in September 2016 with the number of transactions processed by Bacs in a single day reaching 109.3 million.
In 1968, the electronic transfer of funds between banks was introduced by the Inter Bank Computer Bureau intended to improve the existing clearing system by avoiding the need for paper documents. In 1971 this organisation was renamed Bankers Automated Clearing Services and, in 1986, the company shortened its name to Bacs Limited.[1]
On 1 December 2003, Bacs Payment Schemes Limited (BPSL) was split from Bacs Limited: BPSL as a "not for profit" body with members from the banking industry promoting the use of, and setting the rules for automated payment schemes, with Bacs Limited owning the infrastructure to run the schemes.
Bacs Limited was permitted to continue to use this name for one year, and became Voca Limited on 12 October 2004. Voca Limited has since been merged with the UK national switch provider LINK Interchange Network Limited on 2 July 2007, the new company being called VocaLink. VocaLink owns the infrastructure on which payment schemes operate and Bacs Payment Schemes Limited maintains the integrity of the current schemes.
From a technical perspective, in 2003, Bacs users began moving from the telephone dial-up BACSTEL service (introduced in 1983 to replace magnetic media) to an Internet-based service, BACSTEL-IP, which is quicker and more secure. All Bacs users, including businesses that make payments to their suppliers or operate their staff payroll electronically, were required to move to BACSTEL-IP by the end of December 2005 or return to using cheques. When the BACSTEL-IP service was introduced all software used to make a connection to Bacs required approval. It is now only possible to make a connection with software from the list of Bacs Approved Solution Suppliers (BASS), or by using an approved bureau.
This was followed in 2008 by the mandatory requirement for all new service users to use AUDDIS – a more efficient system for organisations to send new Direct Debit instructions to their customers’ bank, or building society, electronically instead of in paper format. In the same year, annual Direct Debit volumes surpassed the three billion mark and, by 2013, this figure reached 3.5 billion with 100 billion payments processed since 1968.
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