What Is An Early Debit Order

An early debit order (EDO) is a debit order collections processing system aim primarily at the micro-finance industry. However, many other industries are finding this service highly useful- the major benefit being to decrease the risk of non-payment to the financier or company issuing a debit order.

The EDO system caters for debit order requests up to the value of five thousand rand, by facilitating randomized preferential collections with the banking system. This means that as soon as the money becomes available in the account, then the debit order systems pick up that there is money in the account and the debit order is processed. A reason for this is that it gives companies a better chance at receiving the funds owed to them.

To enable the collection of EDO payments, the NPS Act was amended on 26 May 2006. This allowed the phasing out of the existing preferential practices in place at banks where certain debit orders were given preference when processed. This now allows all EDO payments to be processed first after bulk credits (salaries) into the account.

There are two types of EDO collection systems: Authenticated Early Debit Order and Non Authenticated Early Debit Order.

financial

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Authenticated Early Debit Order (AEDO):

An AEDO enables the account holder to mandate the contracted future EDO through the use of their bank card (credit and debit cards) and pin number.

The AEDO service enables customers to electronically authorize future dated deductions from their bank account for payments (gym contracts, insurance premiums, loan repayments) at the point of sale, by simply swiping their bank card and entering in their pin numbers. As the deductions are authenticated by the consumer in person via an electronic signature, these payments cannot be rejected by the customer once they have paid.

The benefit of AEDO is that they are authenticated through an electronic mandate and disputes are therefore minimizes.     

Non Authenticated Early Debit Order (NAEDO):

The NAEDO collection service is provided by the banks. Banks enable companies to process payments entirely by computerized means. This service can be used for collecting debit order payments from clients. NAEDO payment instructions support multiple uses for debit orders. If the debit order is unpaid then credit tracking can be raised. Credit tracking is optional and will be automatically authorized that same working day or until the payment is made.

This means that if you do not make a payment, then the company can opt for credit tracking (monitoring your account until the amount owed is available). All NAEDO payments are randomized, allowing companies an equal opportunity of receiving the monies owed to them for a service or product supplied to the customer.

An early debit order guarantees companies that they will receive the money owed to them by the consumer, but the AEDO and NAEDO systems. 

A debit order collections system saves you time and money. Why not save money and time, try this fantastic system – it works!

I am Greg Jones and I use this system to pay my bills and I have said goodbye to the stress of paying the right companies the right amount on the right days – make life simpler and go do the things you enjoy.

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