The Day My Direct Debit Billing System Broke: What Happened And How To Avoid The Same Trap

You know how satisfying it is when everything just works? For me, one of those beautiful systems is the automated direct debit billing system for my retainer clients. Every month, like clockwork, invoices go out via direct debit, and money arrives neatly in my account. It was like a well-oiled machine… until one day (23 August to be precise) it stopped.

Here’s what happened, what I learned, and how you can avoid the same trap.

The Perfect Direct Debit Billing System… Until It Broke

I usually bill my retainer clients at the same time each month. It’s a seamless, automated process where I approve repeating invoices and in the background the API sends them through to the direct debit processor thing. Then as if by magic, the payments appear in my account.

It’s reliable, efficient, and helps keep that coveted MRR (monthly recurring revenue) flowing.

Until one month, it didn’t work.

I’m not talking about a client defaulting on payment. No, this was fully widespread. The clever automation, for reasons unknown, silently broke.

No warning. No error message. And it took me a few days to even realise something had gone wrong. 

The Moment I Realised Something Was Off

When we reached the expected payment date, I noticed something missing – the money. Naturally, I went digging to discover nothing had processed!

The API, behind the direct debit billing system, the same one that worked flawlessly for months, had decided to take an unscheduled break. And after multiple follow-ups with support, I still had no idea why.

But there I was, stuck, with no incoming payments. So what did I do?

My Quick Fix (For Better or Worse)

Now, I’m not saying this is the perfect solution, but it worked. I temporarily changed the due dates on all outstanding invoices. With this small tweak, the automation kicked in again.

I then of course communicated with my clients affected apologising for the delay and explaining the situation as it’s not ideal for them either!

While the payments started to process again I was relieved… but it got me thinking about how vulnerable we can be when we rely too heavily on automated systems, especially for something as critical as cash flow. 

How Can You Protect Your Cashflow?

I learned a few important lessons from this hiccup. Here are my top tips you can use to safeguard your business from a similar experience:

👉 Monitor Your Automations

Don’t assume get confirmation… even if it’s a manual step, make it part of your routine to check that all your automated systems are actually working properly. 

👉 Vary Billing Dates

If it aligns with your business model and client terms, consider if you could perhaps stagger invoice due dates. This could reduce your reliance on one single payment event. Spreading out cash flow, which can be a lifesaver in case of delays.

👉 Diversify Payment Methods

If possible, don’t rely solely on one payment system. Offer multiple payment methods across your offer suite. This can not only give more flexibility but also ensures you’re not dependent on a single system.

In my case, I was fortunate that my direct debit cycle is only one part of the picture so cash flow didn’t come to a halt when the automation failed.

👉 Prepare for those ‘What-If’ Scenarios

Make sure you’ve got enough lead time between receiving payments and when you need them for payroll, expenses, or anything else crucial to keeping your business running smoothly – rather than being too ‘Just In Time’ where possible.

Do you have backup plans in place if your payments did get delayed?

(Let’s face it there are many reasons this could happen).

Would it be possible to perhaps access savings or credit if needed to cover a gap? 

Plan for the Unexpected

Ultimately, even the best systems can fail. Being proactive about monitoring and having contingency plans in place can save you from a cash flow drama.

And the upside?

Well since it wasn’t a major disaster this time around for me (or my clients) that was a big positive! And having a system wobble has prompted me to put in some additional checks for the future and given some useful lessons and tips I can share more widely!

I did think at the time.. “well at least this will be something helpful and relatable for my next newsletter/blog article” 😄

I’m curious if you’ve ever had a similar experience with automations failing? How did you deal with it?