Gateway Overview: NZ Bank Direct Debits

Most NZ Banks offer Direct Debit facilities to approved customers through their online banking or PC software.  uCollect can prepare the DD file for you to upload to the bank (the banks do not provide us with an interface to be able to do this on your behalf).

To be able to use Direct Debits directly with your bank you need to be approved as a Direct Debit Initiator.  This can be problematic for many small businesses.  If your bank does not approve you (or you want a more automated solution) then please consider EziDebit.

Please contact your bank directly to inquire about this.  It can take some time to go through the approval process.

To set up your gateway in uCollect Add a new Gateway (Edit Organisation, or from the setup wizard) with the following details:

  • Gateway: choose the appropriate bank’s Direct Debit option.
  • Enter your Banking details as prompted. If you are not sure what to include here please contact your bank for clarification
  • Calculate Commission/Fees on Settlement: This option is not appropriate for NZ Bank DD Files.
  • Pay Now: NZ DD files are not eligible for Pay Now.  If you want something for PayNow please consider EziDebit.

You can also set the default values for the Particulars, Code and Reference to appear on your customer’s bank statement.  In any of these you can include:

  • “[Contact]” (without the quotes) to have this pre-filled with the contact’s name from Xero.   Please note that there is a limit of 12 characters in the Ref/Part/Code fields, and uCollect does NOT truncate the contact name here.  Most banks will truncate automatically when receiving the file, but may still give you an error (ANZ gives an error, but the file still processes).
  • “[Invoice]” (without the quotes) to have this pre-filled with the Xero invoice number (if more than one we list the first one and “etc”).

For help on using the Gateway setup screen please see the help page.

We pull the Bank Account number from the Xero contact record data.  You need to ensure that the bank account number is entered in Xero in the format BBBBBBAAAAAAASSS (we strip out dashes and spaces, so the following also work: BBB-BBB-AAAAAAA-AA, BBBBBB AAAAAAA AA, BBBBBB AAAAAAA AAA).  When you Edit Contact in uCollect we will display the Bank Account number from Xero so that you can see if it is correctly formatted.

When setting up your contacts in uCollect you usually can enter the Particulars, Code and Reference to appear on their bank statement.  In any of these you can include:

  • “[Contact]” (without the quotes) to have this pre-filled with the contact’s name from Xero.
  • “[Invoice]” (without the quotes) to have this pre-filled with the Xero invoice number (if more than one we list the first one and “etc”).

Because your bank does not give uCollect the ability to submit the DD data directly to them we have to get you involved in the process.  This is not our ideal mode of working!

  1. Every day we check your Xero ledger to see if you have collections that need to be initiated (we based this on invoices that are due or over due).
  2. If there are collections due by DD file then we will send you an email asking you to log into uCollect.
  3. When you log into uCollect you click on the Generate Now link (or go to Collection History and click Process Now).
  4. uCollect will check again to see what payments are due for collection.  At this stage you can preview this list and suspend any invoices from collection (until further notice).  When ready you click Generate.
  5. uCollect will now generate the DD file and download it to your browser.  If you have multiple payment dates (usually because you have set the “Number of days in advance to initiate”) then we will prepare one file for each date.  We will also mark the invoices as paid in Xero.
  6. It is ESSENTIAL that you upload the DD file(s) to your internet banking right away.  If you fail to do so payments will not be initiated.

If you are away for a day and payments are due but you don’t generate the DD file in uCollect there is no need to panic.  Simply log back in the next day and any invoices that were due for collection will be included in the current batch.

Each bank has a different process for setting up the batch.  If your bank is not listed please feel free to email us the steps and we can include it for all.

  • ANZ: select New Batch “Bulkload Domestic Payments”, File format = “Domestic Extended”, Transaction/Batch Type = “Debit”.  Select your batch date, Debit Auth Code” and bank account from the lists.  Then click “Bulkload” and approve your batch as normal.  Please note that if you get “Field length should not exceed 12 characters” you will need to change the Particulars field value on the Edit Organisation, gateway settings area.  You can simply re-download the file once this done.
  • Any errors to do with Hash totals (e.g., “Hash total differs from control record” in ANZ) is always an issue with one of the bank accounts.  Please review the bank accounts in Xero, change the invalid one in the Xero contact record, and re-download the file from uCollect.