I have just used a web directory submission service that submits my website to around 200 online directories. I have a slight concern as I have read that having too many directory links may get yor SERP (Search Engine Position) penalised by Google.

 

Is this true?

No not at all;

Instead it helps you for getting in serp faster,

While submitting, try to submit your site with different keywords, description and title as your anchor text.

 

Search for most appropriate section for your site;

eg if your site is hosting related then try to submit it at : computers/internet/hosting.

Having too many directory link won't penalise you in google, submitting and being listed in bad directories (known spammers/blacklisted etc) might hurt tho! I would tread with caution!!

Submit to directories which are well categorized. Submitting to directories which resemble link farms even though may not directly hurt you but will not provide much benefit and are just a waste of time.

Yeah, I think submitting to worthwhile directories, and properly won't hurt you. But really bad network farms will.