What is Direct Debit?
An instruction to your bank that allows a company to collect payments from your account. Most switch bonuses require 2-3 active Direct Debits. You can set up cheap ones (from 30p/month) using services like 30p.co.uk specifically to meet these requirements.
A Direct Debit authorises an organisation to pull money from a current account — the amount and date are controlled by the collector, within the terms of the mandate. It's the standard way UK households pay bills, and it comes with the Direct Debit Guarantee: any payment taken in error must be refunded by the bank immediately.
Direct Debits matter to switchers because most bank switch bonuses require two or three active ones to move across as part of the CASS switch. The banks don't usually mind what the Direct Debits are for, only that they're genuine and active — which is why very cheap ones, from around 30p a month via small subscription or donation services, are commonly used to satisfy the requirement.
A Direct Debit differs from a standing order: a Direct Debit is pulled by the recipient and can vary in amount, while a standing order is pushed by the account holder for a fixed amount. Some bonus terms accept either; most specify Direct Debits.