BACS upgrade off to a slow start

Software vendors have reacted warily to a statement from BACS that claims ‘one-fifth’ of its users have migrated to the new internet-based system BACSTEL-IP.

Of the 35,000 businesses that use the payment processing technology, BACS said it was a ‘significant achievement’ that 20% had switched to the new online system.

However, the biggest vendors helping clients make the transition have urged caution and called for more businesses to plan for the migration.

‘The most important thing is that there are still very many businesses to migrate. They really must consider their migration path,’ said Georgia Leybourne, sales and business development director at Albany Software.

Matthew Croxford, product manager at Eiger Systems, warned against complacency among businesses preparing to switch: ‘Don’t think the deadlines aren’t something to be wary of, they must be treated seriously. But the customers we’re dealing with should be fine. BACS are always straight down the line, there’s no reason to doubt their figures.’

BACS has billed its new system as ‘more than an upgrade’, because it uses technology to improve security, and there is the facility to make payments over the internet.

There is a March upgrade deadline for businesses using the X.400 messaging service to provide details of direct-debit payments, while the December 2005 deadline affects all other BACS users.

Mike Hutchinson, BACSTEL-IP marketing manager, said that he was happy with the progress of migration but warned that more needed to be done.

‘We believe that although the message has got across, some businesses have put their heads in the sand. If they stick their hand up in August for help to migrate, it’ll be too late,’ he said.

John Warwick, divisional manager for electronic payments systems at Baron McCann, expressed concern about the number of smaller companies using BACS that had not yet converted to BACSTEL-IP.

‘We’re surprised at the number of low-end users that haven’t yet moved. They have a lot to gain in terms of improving reporting and its ease of operation,’ he said.

Warwick was also disappointed that the larger organisations, already moved onto the new system, had stuck with their original BACS supplier rather than ‘checking their options’.

Businesses can contact their bank, BACS supplier or visit for help and advice on the migration.

Related reading