Direct Debit vs Credit Cards: Which is the Best Way to Take Recurring Payments?

Direct Debit and Credit Cards are two methods used for taking regular payments. Both enable businesses to take payments from their customers easily, but there are some key differences between the two that we will explore in this article.

Before we delve into our comparison, it is important to note that the term ‘Credit Card’ in this article refers to card transactions processed through the Visa and MasterCard network. At Curlec, we process all transactions through PayNet (Payments Network Malaysia). This enables us to utilise the Direct Debit payment system for Malaysian issued Credit Card accounts.










Both are Automatic Payment Methods

A Direct Debit is an authorisation from a customer that enables a business to take payments from their bank or locally issued credit card account. Customers authorise these payments by completing an online mandate and this also acts as an instruction to their bank to allow the Direct Debit. These payments can vary in frequency and amount. For 5 facts about Direct Debit, check out our previous post.

A recurring card payment is an authorisation given by a customer for a business to take payments from them by credit card. Customers must supply a business with their credit card details, such as their 16 digit card number. These payments can also vary in frequency and amount.


Direct Debit vs Credit Cards

Below is a comparison between these two payment methods:

Comparison table between Curlec direct debit and credit cards as a payment method
Which is the Best Way to Take Recurring Payments?
Direct Debit and Credit Cards can both be used to take recurring payments automatically of varying amounts and frequency.
Once implemented, both payment methods are easy to run and offer similar benefits. However, the low penetration rate of credit cards in Malaysia mean that businesses are severely limited in whom they can offer this payment method to. Additionally, the high fees of processing transactions through the Visa and Mastercard payment networks, especially when compared to that of Direct Debit, ensure that this is a costly method to run for businesses.
As a result of this, we believe that Direct Debit is the best way to take recurring payments.
If you would like to find out more about Curlec and Direct Debit, please contact us through the form at the bottom of this page.

5 Ways Curlec Helps SMEs

Malaysia is no stranger to Direct Debit, as this payment service has been available since 2010. However, up until now, it has remained an extremely underutilised system due to the high costs and administrative burden associated with running the previous paper-based process. This has resulted in Direct Debit solutions being exclusively reserved for large organisations that have the resources and capabilities to facilitate it.

SMEs have thus been overlooked by traditional financial institutions as they do not have the volumes or internal processes to handle Direct Debit payments. This has resulted in a large void for SMEs due to the lack of suitable alternatives available to them, particularly for recurring payments. This is emphasised by the fact that the average bad debt per company in Malaysia stands at a staggering RM52,100 with an average 94.1 day credit period, as discussed in our previous post.

It is clear that SMEs have been underserved nationwide and payment collection continues to be a big problem. At Curlec, we are changing this and providing a Direct Debit solution to businesses of all sizes. Here are 5 ways that we are helping Malaysian SMEs:

1) Improve Cash Flow

Direct Debit puts you in control as it lets you collect payments whenever they’re due. This means that you can spend less time chasing payments and increase the volume of cash your business has on hand at any given time.

2) Reduce Costs

With Curlec, you can avoid costly credit and debit card transactions. This is because Direct Debit payments are routed outside of card networks such as Visa and Mastercard, making it considerably cheaper for you.

3) Focus On Your Business

Once authorised, you can take payments from customer accounts with no further action needed from them. This lifts a huge administrative burden as payments become automatic, leaving you time to focus on growing your business.

4) Increase Customer Retention

Curlec is a great way to encourage customer retention and attract recurring revenue. This is because Direct Debit creates a simple payment method that can easily be renewed and maintained over long periods of time.

5) Better Accounting

Curlec easily integrates with accounting systems, meaning that collecting payments become automatic when invoices are due. Once you’ve received a payment, Curlec will mark the invoice as being paid allowing for automatic account reconciliation.

We understand that cash flow and managing money is the lifeblood of SMEs. With Curlec taking care of your payments, you take a huge amount of the hassle out of handling these processes. You no longer need to waste precious time chasing customers for late payment and can instead get back to focusing on growing your business with the peace of mind that there will always be money in the bank, all year round.

If you are interested in finding out more about Curlec please reach out to us here by filling in the contact form below this page.


Direct Debit: Moving Malaysia to a Cashless Society

We are just at the beginning of a payments revolution in Malaysia, which is changing the way consumers are paying for goods and services. In 2019, studies have shown that two in three Malaysians are now utilising cashless payments, with Debit cards and online banking being the most preferred methods of payment.

Since the launch of Bank Negara’s Financial Sector Blueprint 2011-2020, which is the country’s initiative to move to a cashless society, the volume of all electronic payment methods have risen year on year. This shift is a clear indicator of the rapid change in consumer behaviour that is being driven by a desire to make managing finances simpler, faster and more flexible.


Previous Restrictions with Direct Debit

Whilst Direct Debit is a relatively new payment method in Malaysia, it was launched by MEPS (now known as PayNet) in 2010, it has come with some heavy restrictions that have kept it from becoming a universally adopted payment method. This has been reflected in the relatively low Direct Debit volumes to date, which has been primarily due to two main reasons: ease of use and accessibility.

Firstly, old Direct Debit systems have been incredibly paper-based and manual. This has resulted in long processing times and high rejections rates of Direct Debit mandates. As a result, businesses have been deterred from using this payment method.

Secondly, Direct Debit has historically been reserved for larger, corporate businesses that have the resources and finances to facilitate it. Running and administrating Direct Debit was complex and time-consuming, with dedicated full-time employees needed to set-up, collect and manage payments. It is because of this that cash and cheques have remained the most common payment options for SMEs well into the 21st century.

This is now all changing following the government’s initiative to allow and promote online Direct Debit payments.

Curlec is Bringing Direct Debit to the Modern Day

At Curlec, we are bringing Direct Debit to the modern day. Our system uses the latest technology to automate online Direct Debit payments in a seamless manner. The process of collecting recurring payments of varying amounts is now faster, cheaper and far more efficient. This will reduce the reliance that SMEs place on cash and cheques, and help to propel Malaysia to cashless status.

Curlec has transformed the Direct Debit process from an expensive, manual system to an affordable, automated one. We have done this in 3 simple steps:

  1. E-Mandate Set Up – customers sign up by completing an online Direct Debit form, which authorises a merchant to collect payment from a customer’s account when they are due. This is completed instantly with a 100% approval rate.
  2. Automated Payment Collection – when payments are due, Curlec will collect the necessary files to enable the debiting and crediting of bank accounts. Payments then get transferred between accounts in a seamless manner.
  3. Auto Account Reconciliation – successful transactions will be automatically reconciled with a merchant’s accounting system. For unsuccessful transactions, a one-off FPX tool enables customers to pay with a different bank account or credit card.

If you would like to find out how you can move to our cashless solution, please contact us here by filling in the form below this page.

Case Studies

Improving The Membership Experience With DOJO

“As Curlec is an automated, online solution, the high admin cost that is usually associated with growing a business disappears.” -Dewan Ng
Co-Founder, DOJO

DOJO is a co-working space located in downtown Kuala Lumpur that was launched in January 2018. It was born out of a mission to empower the creative and entrepreneurial community, by creating unique work spaces and providing personalised services to connect members to a powerful network.

As a company that relies on monthly membership payments, DOJO were eager to find a payment solution that could simplify their payment collection processes and keep up with them as they look to scale. This is where Curlec came into the fold.

Scaling the Business

Before choosing Curlec, DOJO analysed other existing payment options that mainly relied on credit cards. “What really sets Curlec apart was the way in which their solution completely integrates with the Direct Debit process,” explained Dewan Ng, one of the co-founders of DOJO. “We were keen from the outset to use Direct Debit as it is cheaper and allows for seamless payment collection. We don’t just save on transaction fees, we save time.”

In addition to enabling hassle-free payments, Curlec provides a scalable Direct Debit solution that fits into DOJO’s growth plans. “We currently occupy a 7,000 sq. ft. space in Menara Amplewest, and will be expanding to 21,000 sq. ft. in a couple of months. We have plans to eventually expand this upwards in our building,” said Dewan. “As Curlec is an automated, online solution, the high admin cost that is usually associated with growing a business disappears.”

Creating an Ecosystem

In addition to acting as a physical co-working space, DOJO has created an ecosystem whereby their members gain personalised services, such as on-demand insurance.

“As advocates of innovative ideas and design, we needed a payment solution that reflected this,” explained Dewan. “Curlec is entirely cloud-based and requires very little manual intervention, which perfectly complements the tech ecosystem that we are trying to build.”

If you would like to know how Curlec can help your business scale, like DOJO, please contact us here today by filling the form at the bottom of this page.


Recurring Payments Gone Wrong

A customer’s right to terminate their mandate is a key component of the Direct Debit payment mechanism. Not only does this empower customers, but it also gives them the confidence that any unwanted payments will not happen. There are situations though where customers will be bound by other agreements with a business. For example, a gym may have a policy that members can’t cancel in the first six months of their contract.

Here at Curlec, we have put these principles at the forefront of our thinking and have built a solution that benefits both businesses and their customers alike.


We regularly hear the problems that customers face when using other payment methods. Upon scrolling through LinkedIn this week, one of our founders came across a post that perfectly sums up when recurring payments go wrong.


“OMG! Bad Company Subscriptions… harder to get rid of than the Reader’s Digest!
They rolled over my subscription without notification or permission and then gave me no way to cancel online. My online support case never answered and after several attempts to call them, I was routed back to their office in the US. The support agent couldn’t spell my name to find my account so he then insisted on connecting to my computer which I politely refused.
After several failed attempts to spell my name, my account was finally identified. This was then followed by a debate about whether my account was still under an annual contract… which I never agreed to! I was then sent an email asking me to confirm that I wanted to cancel my subscription with the promise of a confirmation email that still hasn’t arrived. It might have been easier for me to cancel my credit card 🙁
Moral of the story – avoid Bad Company at all cost!” -a frustrated customer

Cancelling your subscription payments shouldn’t be this difficult. And with Curlec, it’s not.

Curlec allows customers to set up a Direct Debit using a Current, Savings or Credit Card account, whilst also enabling a maximum amount to be set for each transaction. Customers are in complete control of when to amend or cancel their Direct Debit payments, providing that this does not breach any other contractual terms that they have with a business. We at Curlec believe that this is the fairest way to do business for both buyers and sellers.

If you would like to find out more, or have had any “Bad Company” experiences, feel free to contact us here by leaving your details in the form below.


5 Things To Know About Direct Debit

Direct Debit as a payment option has been extremely underutilised in Malaysia. When compared to countries such as the UK, where almost 9 out of 10 adults have at least one Direct Debit, Malaysia lags far behind.

This is all about to change with Curlec as our solution using Direct Debit brings payments into the digital age. Check out our infographic below to find out what Direct Debit is all about:

Direct Debit infographic
How Tos

How To Get Your Business Paid On Time

Have you ever had to chase customers for late payment? You’re not alone – the average bad debt per company in Malaysia stands at a staggering RM52,100 per annum, whilst it takes an average of 94.1 days for businesses to get paid.

Late payments clearly put a significant amount of strain on your business’ cash flow and removes the ability for you to plan for the future. Chasing overdue invoices also requires plenty of time and resources, which ultimately impacts your bottom line. It is because of problems like these that Curlec has developed a solution using Direct Debit that will ensure your business gets paid on time.

Make Payments Easier
So how can you ensure that you get paid on time? The answer is simple – make it as easy as possible for your customers to pay you. Here are 3 things that you can do to ensure this:

      1. Set up a simpler way to collect payments – Move away from methods that require a lot of admin work for you and your customer, such as cash or cheques. Using online payment gateways requires such as Curlec requires much less effort for your customer. This means that you can get paid quicker.
      2. Collect on a monthly basis – Collecting on a regular monthly basis means that your customers can spread their costs out evenly, rather than having to front up the money for quarterly or lump sum payments.
      3. Use online accounting software – Invoices and statements can be automatically generated and sent out via email. This saves you having to deal with stacks of papers and worrying about things getting lost in the post.
How Curlec is a Smarter Way To Collect Payments
At Curlec, we understand the difficulties that businesses face when collecting payments and the impact of unpaid invoices. That is why we have created a simple and cost-effective solution that enables you to take Direct Debit payments online.

    • Gain control of when you get paid – Direct Debit puts you in control of when you get paid as your customers authorise you to collect payments when they are due. This means no more late payments.
    • Instant set up for customers – Customers can set up their Direct Debit with you within minutes and their bank details are filled in securely. Once this is done, payments become a seamless process.
    • Automate payment collection – Curlec can integrate with your accounting software so you can automatically set up payments alongside your invoicing.
Get Paid On Time
With Curlec taking care of your payments, we remove the stress of managing you cash flow and unpaid invoices. You no longer need to keep chasing your customers for late payment and can have peace of mind that there will always be money in the bank.

Focus on growing your business and stop worrying about getting paid on time. You can leave that to us.

If you would like to find out more, please fill in the contact form below this page.
Case Studies

Making Payments Easy For The Union

“Curlec has enabled us to reduce our cash flow risks and taken away the administration associated with payment collection” – Carlos Villa, Founder of Union Strength

Union Strength was founded by Carlos Villa in 2017, and it was born out of a mission to provide a community of like-minded gym goers a space where they could truly focus on strength and conditioning.

Prioritising Cash Flow

Malaysia has seen a recent boom in the fitness industry with the number of gyms rising dramatically over the past decade. However, many of these gyms have been unable to sustain themselves and in some cases, closed within a year of opening. This epidemic has not been exclusive to boutique gyms, with international fitness chains falling foul as well.

With this in mind, Carlos was keen from the outset to ensure that he had all the infrastructure in place to ensure that managing cash flow would not be an issue. This involved finding a solution that would be easy for customers to sign up to whilst also simple for the Union Strength team to use when collecting membership fees.

“When I was working on my business plan it became clear that managing cash flow was paramount to success. We’ve made a large investment in equipment and needed to ensure that members have an easy and simple way to pay their monthly fees,” explained Carlos.

“We also needed a system that didn’t solely rely on credit cards as this would not account for our entire member demographic.”

Partnering with Curlec

Union Strength opened its doors in December 2017 and has been taking full advantage of Curlec. As a start-up company, Carlos has been keen to ensure that as many of his processes are digital and automated.

“We used Curlec’s Instant Pay feature to collect our one-off introductory offer. Following this, we have been signing up clients online using Direct Debit,” said Carlos. “The different payment options and the fact that we know our monthly fees will be collected on time is a huge benefit for us.”

If you would like to know how Curlec can help your business stay in control of cash flow, like Union Strength, please contact us here today by filling in the form beneath this page.