Direct Debit Guarantee - Lies!

Extant

ldn-100 wrote: »

I recently had to reverse a direct debit from BT as they were taking more than my bill total. Lloyds TSB were able to do this immediately. However, the person I spoke to said this was because I had spotted it on the day it came out of the account, and if I had not noticed until the next day or later it would take longer to sort out. This makes me glad I check my online banking every day.

Direct debits are processed through BACS, and done in batches. So the amount will be deducted in the morning, but won't technically leave until the end of the day.

You should technically be able to do this for regular payments, as well, provided they haven't gone by FPS. Depends on the bank, though.

jonesMUFCforever

ldn-100 wrote: »

I recently had to reverse a direct debit from BT as they were taking more than my bill total. Lloyds TSB were able to do this immediately. However, the person I spoke to said this was because I had spotted it on the day it came out of the account, and if I had not noticed until the next day or later it would take longer to sort out. This makes me glad I check my online banking every day.

This is not quite the same as OP's problem.
What you did was reverse a payment going out on the day - that is a simple procedure and of course your account will be recredited on the same day.
When doing a recall of D/D that has already been paid it can take up to 48 hours for the money to be put back in your account.
Personally I think this is a reasonable timescale, compare this to say how long it takes for a debit card transaction to be recredited when necessary to your account - 10 days is not unheard of.
If you do not like the D/D system nobody MAKES you sign up to them.

YorkshireBoy

jonesMUFCforever wrote: »

If you do not like the D/D system nobody MAKES you sign up to them.

To be fair though, many people are happy to use them because they are told...

"If an error is made by the organisation or your bank or building society, you are guaranteed a full and immediate refund from your branch of the amount paid."

Perhaps the DD guarantee should be re-written to say...

"If an error is made by the organisation or your bank or building society, you are guaranteed a refund within 2 days (4 days if you tell your bank on a weekend, and as long as 6 days over the Xmas/Easter periods) from your branch of the amount paid."

Mikeyorks

jonesMUFCforever wrote: »

If you do not like the D/D system nobody MAKES you sign up to them.

Bit unreasonable from an experienced Banking man . The Guarantee which is provided to anyone signing up to a DD is absolutely unequivocal :

If an error is made by the organisation or your bank or building society, you are guaranteed a full and immediate refund from your branch of the amount paid

...... it is the varied and sometimes twisted interpretations put upon this by various Banks (and often by individual Branches where the overall Bank policy aligns with the Guarantee) that brings it into disrepute. Added to, admittedly, by customers declining to understand the 'error' portion doesn't cover their own errors.

p1an0player

aylithuk wrote: »

I work for a major high street bank in the private banking sector

Out of curiosity, are you making a point about some banks being nationalised?
Or do you mean the Premier banking arm of one of the High Street banks?

p1an0player

The other problem with direct debits which were set up electronically (I've forgotten the name) is that if you cancel the DD with the bank, the company may set up a new DD with the same details if it thinks you owe it money! I'm not sure how legal this is.

Regarding the Banking Code, it's a set of "best practice" guidelines that banks aim to follow, but I don't think banks are legally obliged to follow it.

Extant

p1an0player wrote: »

The other problem with direct debits which were set up electronically (I've forgotten the name) is that if you cancel the DD with the bank, the company may set up a new DD with the same details if it thinks you owe it money! I'm not sure how legal this is.

AUDDIS. As for setting up a new direct debit, it depends what you've agreed to with your original mandate.

Regarding the Banking Code, it's a set of "best practice" guidelines that banks aim to follow, but I don't think banks are legally obliged to follow it.

No, we are not legally obliged to follow it. We do, however, pretty much write it ourselves, so it makes sense that we stick to it. If a bank doesn't adhere to it, then you can complain to the Banking Code Standards Board or the BBA (although this may have changed now).

But, to be honest, BCSB spends more time making sure we display base rate notices and the like than anything else, and complaints raised with them don't even qualify as a slap on the wrist.

The real benefit of complying with the BC is the bad publicity that tends to arise if we don't comply.

JohalaReewi

Many thanks for the banking staff on this thread confirming that banks these days generally give two fingers to the DD guarantee. RIP

Incisor

jonesMUFCforever wrote: »

... If you do not like the D/D system nobody MAKES you sign up to them.

No, they just charge you more for not signing up.

Incisor

aylithuk wrote: »

I work for a major high street bank in the private banking sector. What I think customers fail understand is that the bank pays you back out of their own 'pocket' so to speak while we are getting the refund back from the retailer.

I for one understand that. But I don't think it is a hardship for the banks. It is not as if they are short of money, is it?