What Are Bacs Payments?   by Dominic Donaldson

in Finance / Accounting    (submitted 2010-02-18)

When it comes to making payments over the internet everyone is a little skeptical about security. It can be quite a daunting thing to put your most trusted numbers into a machine when every day we are being warned about the increase in scams on the internet. Thankfully there are some companies and banks that take this quite seriously and they have come up with a number of schemes to make it safe and secure to perform financial transaction on the internet. One of these systems is BACS payments.
But what are BACS payments? Well to put in simply BACS payments is a fast and secure way for companies to interact with the bank. It has been perfected and honed over the years to be one of the most secure forms of making payments from account to account. Most companies around the UK use some form of BACS payments system to regulate payments to the company and also payment of the employee's monthly wages.
What a lot of people might be wondering is what BACS actually stands for. Well to put you out of your misery it stands for Bankers Automated Clearing Services. So the next time someone asks you or you get that question in a pub quiz you can rest in the knowledge that you now know that little nugget of information, if you really wanted to.
Obviously BACS isn't available to everyone, which is a shame as we could all do with more secure methods of paying for our various purchases off of the internet. But what is the answer when it comes to making purchases over the internet? One idea is to have a central secure site like PayPal where your card details are stored securely encrypted on a server. Once this has been done, you can make payments to certain authorized PayPal dealers simply by entering your email address and password. Obviously this still doesn't cover you when you make payments to dishonest and unauthorized dealers, but the person making the payment has to take a certain amount of responsibility when making a payment on the internet.
Another option being used by certain credit card manufacturers is the password option. Not only do you now have to enter your card details and the CSV number, but also a password which the card holder has set. This ensures that no fraudulent user can use your card for online purchases.
Any form of payment protection is welcome, but if I had a company I would certainly feel glad that there was a system like BACS payments available to use.