Tech start-up launches in West Midlands to help SMEs collect orders

A TECH start-up that has developed an online tool to help SMEs collect direct debits is launching itself in the West Midlands.

GoCardless, founded by graduates Matt Robinson, Hiroki Takeuchi and Tom Blomfield, is targeting businesses using more mainstream tools such as PayPal and WorldPay.

The company has grown 50% month-on-month since its launch in 2011. It has recently secured a $5m funding package from UK venture capital funds Accel Partners and Passion Capital to help drive its public rollout in key regional centres and across Europe.

The free sign-up facility has no monthly charges and charges just 1% of the transaction total to a maximum of £2. Hundreds of companies from 10 different sectors in the region are already using the system to process millions of pounds of transactions each month.

“Direct Debits are without doubt the most reliable way to take payments, but the banks have long excluded all but the very largest merchants from accessing the scheme,” said Mr Robinson.

“Instead, small business owners must attempt to manage unpredictable cash-flows whilst losing key staff to chasing payments, not to mention the possibility of missing out on growth opportunities.

“GoCardless will give them instant, easy access to a method their larger competitors have been using for years.”

The company is aiming to have signed up thousands of firms in the West Midlands by the end of the year.

The technology has been developed so that GoCardless provides a flexible payment solution for one-off payments, subscriptions or variable and irregular payments.

The company is regulated by the FSA, stores data in the UK with military grade security systems and can be integrated into existing accounting software for automatic reconciliation of invoices.

Early users in the West Midlands include publishers, independent wholesale retailers, gyms, IT firms, educational organisations and manufacturers.

UK Site Builder, a Wednesbury-based web design and e-marketing agency, is one of the firms to have signed up. The company has been using GoCardless as part of a private trial to collect variable Direct Debits from clients.

Simon Powers, Managing Director, said: “We used to waste time chasing regular payments, which as a small business we couldn’t afford. Having switched to GoCardless, we are a lot more streamlined and can focus on what we do best.”