Direct Debit setup between two banks for full payment of credit card bill !!!

intalex · 25 January 2006 at 12:36PM

Hello my fellow forum members,

I have a Mastercard Credit Card from HSBC, and have set up a Direct Debit for the full payment of its Debit balance each month from my Barclays Current a/c.

However, there seems to be a problem somewhere causing the payment to not go through, despite there being more than sufficient funds in my Barclays Current a/c. This has now happened for 2 months in a row.

The first time, I even got charged a late payment fee and interest charges, which they duly refunded after realising that the Direct Debit had not claimed the payment automatically. At that stage, they thought there might have been a problem with the Direct Debit so they cancelled it and set it up again.

Now the same situation has re-occurred this month. This time, I called HSBC Credit Card Services (based in India) and they just cannot tell me where the problem lies. I basically asked them to look into the Direct Debit (and contact Barclays if necessary) to find out where exactly in the Direct Debit cycle the problem lies.

In the meantime, I have had a few letters from HSBC asking me to pay my bills or else my credit card will be blocked and my credit rating ruined. When I mentioned these letters to the Customer Service Rep, she just asked me to ignore these letters because they are machine-generated.

I'd appreciate some general advice on how to overcome this situation, and in particular, whether or not there are any known issues associated with having a Direct Debit set up between two banks.

Thanks in advance.

grumbler · 25 January 2006 at 12:43PM

Can you see this DD on your Barclays account online?

intalex · 25 January 2006 at 1:02PM

grumbler wrote:

Can you see this DD on your Barclays account online?

Yes, I certainly can. It's the only DD on my Barclays Current a/c.

intalex · 25 January 2006 at 1:41PM

Hi again Grumbler, I just noticed you add the following line at the bottom of one of your posts in another board:

P.S. When you phone HSBC to make a BT, don't forget to ask them to set up DD for minimum payments. Be very careful with the first one: make sure that it will be collected by DD, otherwise pay manually.

It seems you know something about HSBC not collecting payment by DD. I'd greatly appreciate it if you could guide me to any other thread which discusses this issue.

YorkshireBoy · 25 January 2006 at 1:46PM

intalex wrote:

It seems you know something about HSBC not collecting payment by DD. I'd greatly appreciate it if you could guide me to any other thread which discusses this issue.

It's not advice specific to the HSBC card - it's something you should check for all credit cards.

Put simply, if your statement doesn't say that the DD will be collected on xx/xx/xx, then pay by other means to avoid any late payment penalties.

grumbler · 25 January 2006 at 1:51PM

intalex wrote:

It seems you know something about HSBC not collecting payment by DD. I'd greatly appreciate it if you could guide me to any other thread which discusses this issue.

No, this is my usual advice for all CCs. Sometimes there is not enough time for the DD to be setup properly before the first payment, hence there is a risk of of losing 0% on transferred balance. You can be sure only if it is printed on your statement that the payment will be collected by DD.

intalex · 25 January 2006 at 2:15PM

Well, I set up my DD back in September last year, and I first used my CC in November. Unfortunately, I don't have my December bill (the one with November transactions) to hand, so I can't check if it says anything about the bill amount being collected automatically by DD. The Customer Service Reps I have spoken to at HSBC have confirmed, however, that the DD is in place and should be collecting the payments automatically.

But isn't it wrong for these banks to offer a DD service and then not claim the money when it's due? The fact that they refunded me the late payment fee and interest charges last month shows that they accepted it as their own fault.

However, they still haven't found out what caused it and how to fix it. Any ideas on what could be causing this (ruling out the case where there isn't enough time between the DD setup and first payment)?

Cheers!

intalex · 25 January 2006 at 4:57PM

I'm just looking at my latest Credit Card statement which also includes the unpaid balance from last month's statement. Nowhere on the statement does it say that the amount due will be collected automatically by DD. Perhaps even last month's statement would be the same - i.e. nothing confirming that the payment will be collected automatically via DD.

So maybe the DD hasn't been set up properly after all, even though HSBC claim that it has and my Barclays a/c shows it as well. Weird, but possible I guess. I'm expecting a call back from HSBC any minute with a report on what went wrong and how to fix it.

I'd normally just pop into my branch to sort it out, but I am working abroad for a year and so I don't have the luxury of a branch down the road. This was the whole point of me setting up a Direct Debit in the first place, but here it is proving to be more of a hassle than of assistance.

Just in case the HSBC guys still can't figure out what's going wrong, can any of you experts think of any other reasons for this situation?

Cheers

intalex · 25 January 2006 at 6:56PM

OK, got a delayed call from HSBC. Looks like nobody there can solve the mystery yet.

So for now, I have to pay my credit card bill manually. In the meantime, a highly enthusiastic Customer Service Rep has assured me that he will not rest until he has discovered the reason why the payment was not collected automatically via DD despite it being set up properly at both banks. Apparentl he'll have something concrete within the next 2 days. I'll duly update everyone here.

I've been assured that the two missed payments, which they acknolwedge are not my fault at all, will not affect my credit rating in any way.

YorkshireBoy · 25 January 2006 at 6:59PM

intalex wrote:

I've been assured that the two missed payments, which they acknolwedge are not my fault at all, will not affect my credit rating in any way.

I'd suggest getting a copy of your credit reports in a couple of months or so, just to make sure.

intalex · 25 January 2006 at 8:07PM

YorkshireBoy wrote:

I'd suggest getting a copy of your credit reports in a couple of months or so, just to make sure.

I think you have a point there - better safe than sorry. I'll do one at the end of March. Thanx for the suggestion.

Direct Debit setup between two banks for full payment of credit card bill !!!

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