GIRO stands for “General Interbank Recurring Order.” It is a payment service commonly used in Singapore and some other countries. It allows individuals and businesses to make regular, automated payments to various service providers or organisations directly from their bank accounts.
Here’s how GIRO works:
Authorisation: To set up GIRO payments, the payer (individual or business) needs to authorise the service provider or organization to debit their bank account for recurring payments. This authorization is usually done by completing a GIRO application form provided by the service provider or organization.
Bank Account Linkage: The payer links their bank account to the GIRO service by providing their bank account details on the application form. This typically includes the bank account number, bank code, and branch code.
Payment Schedule: The payer specifies the payment amount, payment frequency (e.g., monthly, quarterly), and start date for the GIRO payments. These details are included in the GIRO application form.
Processing: Once the GIRO authorization is set up, the service provider or organization initiates the payment transactions on the specified dates. The payments are processed through the banking system, and the specified amount is debited from the payer’s bank account and credited to the recipient’s account.
Notifications: Both the payer and the recipient receive notifications of the GIRO transactions. The payer’s bank statement will show the debits for the GIRO payments, while the recipient’s bank statement will show the corresponding credits.