When it comes to making recurring payments in Singapore, one of the most common ways to do so would be GIRO (General Interbank Recurring Order). 

Such is its ubiquity, most Singaporeans would have had experience setting up a GIRO arrangement, whether it’s to pay for school fees, utility bills or Government dues.  

But while GIRO is highly convenient for users, how suitable a payment platform is it for businesses?  

In this blog post, we’ll try to answer that question. We’ll look at:  

• what GIRO is and what it’s good for 
• how business can use GIRO  
• pros and cons of using GIRO for your business  
• what alternatives to GIRO businesses can consider

Sounds good? If so, without further ado, let’s jump right in.  

What is GIRO  

In simple terms, GIRO, or General Interbank Recurring Order, is an arrangement you set up with your bank to allow a billing organisation (BO) to debit your account to collect on outstanding bills.  

It was launched as far back as 1984 as an electronic direct debit platform. And where GIRO is especially useful is for payments which are recurring in nature. 

Besides providing a convenient way for users to make payments, GIRO is also a low-cost method for billing organisations (BOs) to collect on outstanding bills.  

GIRO in Real Life 

Now… take for example, your household utilities.  

This is a recurring bill that you’d want to stay on top of as a consumer, right?  

Setting up a GIRO arrangement means you’re authorising your bank to allow your utilities company to debit your bank account for your monthly utilities.  

As long as your bank account has enough funds, your payments will happen automatically in the background through GIRO, which means one less thing for you to remember and worry about.   

How Are Businesses Using GIRO 

So what type of businesses are using GIRO as a collections platform today?  

Today, it is widely used by businesses and payers to clear their bills with government agencies like  Central Provident Fund (CPF) and Inland Revenue Authority of Singapore (IRAS), as well as private sector BOs such as telcos, utilities, insurance, and schools. 

For some special fees such as the foreign maid levy, it is the only mode of payment allowed.  

And as one of the earliest electronic direct debit platforms introduced, it has certainly grown to become synonymous with regular bill payments in Singapore.  

Pros and Cons of Using GIRO For Your Business 

For businesses, the advantages of using GIRO in your business are manyfold and obvious.  

It is a familiar payment platform for businesses and consumers alike, allows regular and automated collection of bills. 

However, what is not so clear are the disadvantages of using traditional GIRO. To understand this, we need to take a look at the GIRO application process. To initiate a GIRO payment arrangement, the payer would need to: 

• complete a GIRO application form  
• submit the application form or mail it out  
• wait between two to three weeks for the application to be processed and approved 

If there are any issues with the submitted form (e.g. missing information, inconsistent bank account details), the user might need to resubmit the application causing further delays to the GIRO arrangement. 

For today’s businesses and consumers, who are used to expecting everything instantaneously, the paper application process is a turn-off. It is no wonder that the actual usage of GIRO remains relatively low in Singapore. 

In addition, GIRO arrangements work best for recurring payments of the same amount such as internet bills, insurance premiums and membership subscriptions.  

For bills with unfixed amounts such as utility bills, credit cards or even phone bills, the payer would need to ensure the charges are accurate. This is a huge disadvantage as the need to vet through a bill before and after every deduction against your bank statement makes this process counter-productive and severely off-putting.  

This is why many payers sometimes prefer to make payments using credit cards – which is digital and much more instantaneous.  

Why Businesses Need An Electronic GIRO Platform 

So, when it comes to collections and getting paid on time, we can see that GIRO is truly a cost efficient and cost-effective platform for BOs, but is still a manual process and not as efficient. 

But what if we could do away with the paper applications and lengthy waiting times, and go entirely digital with GIRO applications?  

That would mean both BOs and users could enjoy all the benefits of GIRO without its current disadvantages. Wouldn’t that be great?  

How EzyPayment eGIRO Offers A Solution 

Here at SGeBiz, we’re focused on helping businesses accelerate their growth in the digital economy through innovative solutions in integrated payments, financing and value-added services. 

That’s why we’re bringing to the market EzyPayment eGIRO to help businesses enjoy the benefits of an electronic GIRO platform.  

With EzyPayment eGIRO, your business can simply send a request link to your customers, through which they can click to trigger the electronic direct debit authorisation. The whole process is entirely digitalised and you can be assured of receiving payments from your customers seamlessly.  

Similar to GIRO, EzyPayment Direct Debit is supported by the major banks in Singapore so you can be sure the majority of your customers can be transited to our collections platform.  

Reconciliation benefit 

On top of that, EzyPayment eGIRO doesn’t just help digitalise the payment collection and issuing process, but also the reconciliation process that comes after that.  

With the traditional GIRO method, the reconciliation process is just as tedious because of the painstaking cross-checking process against invoices or payment vouchers. Imagine having to vet through a month’s worth of bills! 

EzyPayment eGIRO on the other hand, streamlines invoice reconciliation with proprietary Optical Character Recognition technology to help automate and digitalise the process. This helps to eliminate human error and makes the overall finance management process much leaner.  

Conclusion 

So if you’re running a business and looking to improve on collection processes – whether that’s increased efficiency, less manual processes or lower transaction costs – EzyPayment Direct Debit could very well be the solution for you.  

To find out more about our solution, get started today!