GoCardless is launching a new tool today to help small and medium-sized businesses accept direct debit payments online.

Large companies have had access to this for years, but many smaller firms are still stuck sending out invoices, waiting for cheques or long-winded bank transfers from numerous clients. It’s tiresome and ultimately involves an awful lot of legwork, which is a detrimental to small teams who just want to keep developing their core product or service.

PayPal has been doing this for a while, but GoCardless wants to make the process cheaper and simpler to manage. So for starters, there’s no upfront costs or monthly fees. The company charges users 1 percent of each transaction, although £2 is the uppermost limit.

PayPal, in comparison, charges 3.4 percent plus a standard rate of 20 pence and there’s no ceiling on overall transaction fees.

The UK-based startup accesses the direct debit network through its sponsor, the Royal Bank of Scotland, and is registered with the Financial Conduct Authority (FCA) as a small payments institution, so it’s fair to say your money is safe at all times.

Users can request a payment either through the GoCardless dashboard, available from any browser, or the company’s existing API. It’s a very straight-forward process, requiring only an amount, reference or description and payment frequency.

GoCardless then generates a custom link, which directs the user to an online checkout not too dissimilar to Stripe. The usual bank account details are submitted, and then the payments are sent to the user’s bank account after seven working days.

The dashboard also shows a history of the direct debit payments processed through GoCardless, filtering requests by when they were created, customer name and status (pending/paid out).

“Direct debit is the most reliable way to take payments, but until now SMEs, from wholesalers to service companies, were shut out,” Matt Robinson, founder of GoCardless said.

“GoCardless gives them instant, easy access to the payment method their larger competitors have been using for years.”

The caveat is that at the moment, GoCardless is strictly focused on small businesses in the UK. That means the service can’t be used to accept payments from non-UK bank accounts – although the company plans to be available across the EU “soon”.

Image Credit: Christopher Furlong/Getty Images