Retail businesses must take action to avoid payment disruption in 2006
Over 17 per cent of businesses in the retail sector face payment disruption in 2006 unless they take immediate action to update their electronic payment systems.
These organisations in the retail sector that rely on the current BACS system for their day-to-day electronic transactions are in danger of missing the December 31st deadline, when the current BACSTEL access channel will be switched off and completely replaced by the new “BACSTEL-IP” channel.[box]”Organisations that usually rely on automated payments will face a real problem if they don’t start the transfer process soon”. Michael Chambers, managing director, BACS Payment Schemes [/box]
Despite a successful migration that has seen over 80,000 businesses make the transfer to BACSTEL-IP since the upgrade was first available
in March 2003, many businesses, particularly SMEs, have been slow to act. Those that fail to make the deadline will have to make alternative arrangements to cover regular payments, such as employee wages, in the new year.Updating payment systems to accommodate the BACSTEL-IP channel, which offers heightened security and faster payment confirmation, is simple.Users simply need to complete an application form if they use a payroll bureau or contact their BACS software supplier to obtain a software solution if they submit payment files direct to BACS. However, the transfer does not happen overnight, and businesses that have not yet started the process will miss the cut-off date if they fail to take action now. Looking at industry, the hospitality and health sectors have the most businesses yet to complete the migration process, with 19 per cent and 18 per cent respectively still unprepared for the December deadline. The retail and utility industries are next, with 17 per cent and 14 per cent of businesses in danger of running out of time to migrate.
Michael Chambers, managing director, BACS Payment Schemes limited,comments, “Organisations that usually rely on automated payments will face a real problem if they don’t start the transfer process soon. In addition to not being able to make payments or collections themselves, they face the inconvenience and extra administrative burden of arranging to make payments through their bank or a bureau until they have completed their software implementation. This could compromise business continuity for some companies in the early months of 2006.
“The transfer process is very simple, so the impetus is on UK business owners to take responsibility for their payments processes to ensure an uninterrupted financial start to 2006.”
