Direct debit

A direct debit is a regular payment out of a bank account.

The payer signs an instruction that lets the payee collect money. The payee decides the amount and the date, and both can change.

The payee must tell the payer in advance before it changes the amount or the date.

It suits a bill that changes. No document arrives on the day it is paid, so the bookkeeper has to enter it in the cash book from a list of regular payments or from the bank statement.