What is direct debit?

Have you embarked on the adventure of entrepreneurship, and are you in the process of putting together your company registration documents? Registering your company is only possible if you have a professional bank account to deposit your share capital! Here are the essential points to bear in mind.

Direct debit for entrepreneurs

Direct debit: definition

Bank domiciliation, not to be confused with company domiciliation, applies to both private individuals and commercial enterprises. The term refers to the fact that you have chosen a banking institution to domicile your income. This will provide you with a Relevé d'Identité Bancaire (RIB ) that you can pass on to your suppliers and customers.

Choosing to have all your income domiciled with a bank is a prerequisite, and should also bring you benefits such as preferential rates and access to certain products.

What you need to know

When you set up your company, you'll need to add to your file proof that you have opened a business account for your company with a banking institution. Your bank will provide you with a RIB and will retain the amount of share capital you have deposited, which you will be able to release once your articles of association have been validated. This is where you can open your partners' current account, or take out loans at preferential rates.

Choosing the right direct debit institution

Note that being domiciled at one bank will not prevent you from opening other bank accounts at other establishments. However, if you plan to open other accounts, be sure to generate enough cash flow to avoid being caught in the trap of domiciling all your income. Indeed, domiciling your financial flows is a prerequisite for developing an effective commercial relationship with your advisor.

That's why you need to think carefully about which bank you'd like to take your direct debit with, by studying the prices charged, the conditions of access to the products on offer, and your bank's ability to support you.

Conclusion

Direct debit is an obligation

As you can see, bank domiciliation is a compulsory step in setting up your company. For your application to be validated, you'll need to prove that your company is actually domiciled with a bank that holds the company's bank account and the share capital you've deposited.

Your direct debit bank receives all your income and will provide you with a bank statement so that you can pay your bills and get paid. So make sure you choose your direct debit bank carefully, in terms of fees and support. Indeed, being well supported in financial terms will enable you to capitalize on your company's growth and develop with peace of mind.