Direct Debit Guarantee

edited 30 November -1 at 1:00AM in Budgeting & Bank Accounts
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edited 30 November -1 at 1:00AM in Budgeting & Bank Accounts
According to the direct debit guarantee you have the "reassurance of knowing that every Direct Debit is protected by... an immediate money back guarantee from the bank or building society if an error is made" (http://www.bacs.co.uk/BPSL/directdebit/generalpublic/benefits/).

Unfortunately, some banks (mine included) are increasingly trying to avoid the implimentation of this guarantee. For example, a call centre manager at bank told me that "we are not a member of the direct debit scheme" and that "it is not technically possible to make an immediate refund". I now have a letter from the bank, which apologises for the errors its manager made.

So, first a tip: if you are refused an immediate direct debit refund after an error is made, just email the nice people at https://www.bacs.co.uk. For me, they put pressure on the bank and the refund was made within the hour!

Next, my little campaign: (Martin, if you'd like to pick this up I'd be more than happy)

I was able to argue my case with the bank. But if it had been my Mum, or even my wife, they would probably have given in - many people tend to believe what the banks tell them. So I want to put some pressure on the banks to stop this lying (I believe they're all doing it, which is why I haven't singled out a particular bank yet).

My letter from the Cooperative Bank, dated 14th November, 2005, states that, "It is our intention to operate the scheme properly". Has anyone here been refused an immediate refund of a direct debit payment error (by the Cooperative Bank) since that date? Because it would be nice to write back to them referring to a list of recent "transgressions". It's probably not a good idea to post your bank details, obviously; name and town/city would be good, though.

I'm not quite sure how to take this forward with the scheme in general. Perhaps I'm wrong, and there isn't a general abuse of the scheme. The main thing I'd like to achieve is for anyone to be able to invoke the guarantee without the annoying, time consuming and stressful argument from the bank.

Your comments appreciated.

Best wishes, Neil
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Replies

  • BossybootsBossyboots Forumite
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    This is the one area of banking for which I have no gripe with abbey.
  • mountainofdebtmountainofdebt Forumite
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    Natwest was brillant when MBNA made a right royal c**k up with a DD from my account in March.

    Perhaps a TV advert campaign telling people of their rights would be sufficient.
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  • greenwichgreenwich Forumite
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    I have never had a DD go wrong but have always wondered what the guarantee really means? Is it enough for you to just assert that an error has taken place for you to get the money back? Or do you have to persuade the bank of the error? The latter would not be much of a guarantee: after all, if the bank itself is persuaded that an error has happened, they would give your money back even without the guarantee. Anyone know the authoritative meaning of the guarantee?
    Eh?? I give up!! Towel is getting thrown in here! :D
  • BossybootsBossyboots Forumite
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    I just notified abbey that a payment greater than that agreed had been taken from my account and they said they would recall the whole sum and I would then have to arrange with the company who were owed the money what they wanted to do about payment.

    Without the guarantee, you would have to negotiate with the company taking the debit, not the bank to get your money refunded. It would not be up to the bank to recover the money incorrectly taken under a direct debit.
  • I work for a bank and whenever somebody asks for a DD indemnity we do it straight away - no arguments.

    This just sounds like a manager who is a bit big for his boots and hasn't much of a clue. Not standard banking practice.

    Let's just hope he got into trouble for it, I would be angry if this happened to me.
  • The guarantee means that you get the money refunded immediately and then argue about it afterwards. The reason for it being like that is that when you sign a direct debit you are effectively allowing a third party to take an unspecified amount of money from your bank account.
  • Daniel wrote:
    This just sounds like a manager who is a bit big for his boots and hasn't much of a clue. Not standard banking practice.

    In this case I only got to the manager after having heard the same story from two minions. And a similar thing happened with the Cooperative about a year ago. So it certainly wasn't just down to the one manager (even though the bank now suggest that it was).

    However, it's good to hear that other banks seem to be operating the scheme properly.

    I'm going to try and have a wider trawl for Cooperative customers who have been abused in this way, though, because I'm not convinced that mine are an isolated pair of incidents.

    Thanks for the responses.

    Best wishes, Neil
  • ffsffs Forumite
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    Barclays refused to refund me after a DD which was actioned earlier in the month than ever before, resulting charges because it went out the day before I was paid. I had to read the DD guarantee over the phone to about four different people before they eventually relented. It took a number of calls over a number of days though. I then had to argue for the charges to be refunded, that took a number of calls over a number of days, and was eventually done on a discretionary basis, not because they accepted that I was owed this money. I then argued the matter in writing for a futher six months before they eventually accepted that they had made a mistake. The issue was slightly complicated by the fact that I was also arguing that a cheque that I had paid in was sufficient to enable the DD to be paid without charges because Barclays can allow you to draw on uncleared funds (up to £1,000) - however they were completely incapable of explaining how you can and cannot draw on uncleared funds. Different staff gave very different explanations, and none were able to provide any written documentation.
  • RichyRichRichyRich Forumite
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    When I worked at Scabbey some managers didn't know their posterior from their elbows. I was never asked by a customer about the DD Guarantee but did ask managers. They questioned the wording of "immediate" and said they'd probably need to see proof.

    It might be different in the Banking Centres.
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  • mandimandi Forumite
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    According to the direct debit guarantee you have the "reassurance of knowing that every Direct Debit is protected by... an immediate money back guarantee from the bank or building society if an error is made" (http://www.bacs.co.uk/BPSL/directdebit/generalpublic/benefits/).

    Unfortunately, some banks (mine included) are increasingly trying to avoid the implimentation of this guarantee. For example, a call centre manager at bank told me that "we are not a member of the direct debit scheme" and that "it is not technically possible to make an immediate refund". I now have a letter from the bank, which apologises for the errors its manager made.

    So, first a tip: if you are refused an immediate direct debit refund after an error is made, just email the nice people at https://www.bacs.co.uk. For me, they put pressure on the bank and the refund was made within the hour!

    Next, my little campaign: (Martin, if you'd like to pick this up I'd be more than happy)

    I was able to argue my case with the bank. But if it had been my Mum, or even my wife, they would probably have given in - many people tend to believe what the banks tell them. So I want to put some pressure on the banks to stop this lying (I believe they're all doing it, which is why I haven't singled out a particular bank yet).

    My letter from the Cooperative Bank, dated 14th November, 2005, states that, "It is our intention to operate the scheme properly". Has anyone here been refused an immediate refund of a direct debit payment error (by the Cooperative Bank) since that date? Because it would be nice to write back to them referring to a list of recent "transgressions". It's probably not a good idea to post your bank details, obviously; name and town/city would be good, though.

    I'm not quite sure how to take this forward with the scheme in general. Perhaps I'm wrong, and there isn't a general abuse of the scheme. The main thing I'd like to achieve is for anyone to be able to invoke the guarantee without the annoying, time consuming and stressful argument from the bank.

    Your comments appreciated.

    Best wishes, Neil



    Thanks Neil,

    My bank refused to refund me when BT asked for a DD that was more then we origionaly agreed. To cut a long story short.. after quoting them th "Terms and conditions" of the DD they gave me a refund.. Relucantly!!
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