GoCardless for Xero - The Basics

Last updated on September 27, 2017 16:05 by Amy T

Who we are: GoCardless for Xero is an integration app that bridges your GoCardless organisation with your Xero organisation. 

How we work: GoCardless for Xero works by creating the bridge between GoCardless and Xero, Automating payment collecting and handling reconciliation within Xero. 

So, the first thing that you need to do for our system to recognise your customers in Xero is raise an invoice against your customers then they will be pulled across into GoCardless for Xero powered by Directli by one of our automated syncs. The Customers sync's run at 12pm and 12am. Invoice syncs run at 1am. These syncs run everyday. 

Then you can ask this client to sign a Direct Debit mandate. There are two ways to do this via the system you can send your customers the link from the Add Customer page, the link from pressing the actions button ( rectangle with the three dots in). Or finally you can Automatic Mandates enabled, meaning the system automatically sends a mandate link once the system pulls in the new customers from Xero.

Then the system will create the payments for all your Xero invoices as long as the customer has a mandate in place and is linked to Xero. If you would like your customers to be debited on the due date of your invoices we always suggest that you have no less than 4 days between the invoice date and the due date in Xero. This will ensure that GoCardless for Xero has enough time to pick up the invoice, create the payment to charge the customer on the desired Due Date. 

The invoice is submitted to the banking system, will be debited from the customer on the due date. However, if this falls on a non-working day, it will be debited on the following working day, and never before.

**To see the lifespan of an invoice please click here**

We then handle the reconciliation. Once the funds for the invoice have left the customers account the full amount of the invoice will be marked as paid in Xero for you. 

Then when GoCardless pay out the funds minus the fees we will get notified of the lump sum pay out amount and the total fees amount. Once we receive this notification we well do the following: 

Bank transfer from the Direct Debit account to your Current Account > Bank transfer from Direct Debit Account to Bank Fees Account. In your current account you’ll then see a Payout from GoCardless and a Bank Transfer from your Direct Debit account. 

All you need to do is go to the reconciliation screen (of your current account), locate the Payout from GoCardless on the left. This should have auto matched to our Bank Transfer which will show on the right hand side of the page. Click options and mark as Reconcile then, and you are all done.

More details of how we handle the Reconciliation can be found here