Cut-off nears for Bacs changeover

30,000 firms still not switched to Bacstel-IP online system

UK firms have less than three months to update their Bacs systems or risk being left unable to process payments.

Some 10,000 firms have made the switch since June, but as many as 30,000 companies have yet to move to the new online system, which will replace existing processes at the end of the year.

Research from payment processing company Voca, formerly known as Bacs, says the average organisation requires up to three months to migrate to the new Bacstel-IP system, the internet-based version of its widely-used payments service.

From 1 January, Voca will cut off access to the old Bacs system, potentially disrupting company payments such as payroll.

Mike Hutchinson, marketing director for Bacstel-IP at Voca, says staff not being paid is a real worst-case scenario, but those firms yet to migrate must act now to avoid any disruption.

‘In simple terms, a direct submission in January from an old Bacs system won’t work,’ he said.

Of the 30,000 businesses yet to make the switch, about 10,000 submit payments directly to Voca, while the rest make payments through independent payment bureaux.

‘Some firms just don’t believe it will happen,’ said Hutchinson. ‘They believe their bank won’t leave them hanging in mid air, but they need to take responsibility for this.’

Voca stepped up its efforts this year to inform all its customers – representing the bulk of UK organisations – about the need to make the switch.

‘We have communicated with them via phone and email. We have run four direct mail campaigns this year. And we will increase that intensity in the final three months,’ said Hutchinson.

Firms unable to complete the upgrade by the due date should look to make temporary arrangements with a bank or bureau.

Many bureaux, says Hutchinson, will still accept payment details in nearly any form – from emails and faxes to ‘the back of an envelope.