Ummair Butt, the visionary founder of Direct Debit System, finds the cumbersome nature of multiple cheque payments bewildering. “Organisations were simply treating cheques as a hedge to protect future cash flow,” he noted in a conversation with edge/.
He emphasised on the inefficiency of this method. According to Butt, bounced payments could be reduced significantly if people adopted monthly payments instead. It led him to start Direct Debit System, a company regulated under the banking license of sponsor bank to run an aggregate service for UAE Direct Debit System (UAEEDS).
Butt highlights the need for a digital alternative, stating, “Both businesses and payers are enabled to use Direct Debit as a secure, legal, and digital payment method in the UAE.” He added the platform’s direct integration with the UAE Central Bank system, positioning it as a pivotal entity in the country’s payment landscape.
Building the product
The transition to a paperless system was imperative, aligning with the government’s push for digitisation. “Today, Direct Debit app can only be accessed through UAEPASS,” Butt explains, emphasizing the system’s seamless integration with Emirates ID and the avoidance of personal data inputs.
Businesses in the UAE have two options for integration: a dashboard with basic capabilities or a more advanced option tailored for large organizations with thousands of clients, utilizing the standardized UAE Direct Debit API.
Navigating through challenges, including system variations and resource optimization, Direct Debit System evolved to address complexities such as signature mismatches and assignment of receivables. “The biggest challenge was variations and finding ways to mitigate those variations,” Butt reflects, acknowledging the hurdles encountered along the journey.
Working around the challenges
Butt’s proposal to directly connect with the Central Bank’s systems proved pivotal in streamlining operations and eliminating latencies. This initiative underscored the company’s commitment to innovation and efficiency in payment processing.
Despite initial market hesitancy, Direct Debit System gained traction, with the team positioning itself for approval from the Central Bank. “It is my mission to create a platform where people can pay their large expenses easily monthly,” Butt stated, highlighting his unwavering dedication to transforming the payment landscape.
Looking ahead, Butt envisions Direct Debits in the UAE becoming instant, underscoring his commitment to facilitating easy monthly payments for large expenses. The company’s expansion plans include operations in the UK by the end of 2024, with a focus on Saudi Arabia and exploration of opportunities in other regions like the USA, India, Pakistan, Malaysia, Indonesia, and Central Asian Republics.
In Butt’s vision, Direct Debit emerges as a safe and legal alternative to traditional payment methods, reshaping financial transactions in the UAE and beyond.
