Minimum payment by Direct Debit

akbmcf1

Just had a weird conversation with my card company regarding paying the minimum amount each month by direct debit and would love to know if anyone else has experienced something similar.....

I set up a D/Debit to pay the minimum amount each month so that i never missed a payment by accident and incur a late payment fee. However, I always pay the full balance off each month, although not necessarily from one account (hence I didn;t set up a full amount d/debit).

Was just balancing my statement from this month and noticed that the payments to the account were short by £11.88. Checked my statement from last month and £11.88 was the minimum payment d/debit. When I rang and asked why this wasn't taken, they told me that if I credit the account anytime in the four days prior to the d/debit being sent, it will adjust or cancel the d/debit accordingly.

The only way to avoid this happening is to make sure the balancing payment that I send lands on the exact day that the d/debit goes out (which is the due date). If I leave it until one day later, I would get charged interest.

Is it just me, or does this sound to anyone else like a sneaky way for the credit card company to ensure you have a balance carried forward so they can charge you interest??

Thanks,
Andrew

NBE

It doesn't sound sneaky, it's very common for credit card providers to do this. On my Lloyds Amex it states the any payments received 4 working days before the direct debit is due to come out will adjust the amount that the direct debit is set for (this is a direct debit for the full amount).

You could try changing the direct debit for the full amount and then paying however much that you want to pay from another account a week before the direct debit is due out. This should cause the direct debit to only cover the remaining balance.

HTH

Weeyin

I think it sounds a bit sneaky. A dd is permenant until you cancel it, they should trust their customers to know they have a dd set up. If they are paying additional payments, then it is just that, extra payments.

CLAPTON

I don't really understand this..
if you 'always' do this why have you only just noticed?
surely if you pay in full then there's no problem
only problem occurs if you pay in full a couple of days before settlement day then you will pay the DD as well.. not much of a problem

financial_warrior

Surely if you just pay the amount in full with one payment, then the amount taken by direct debit will be £0, the total amount paid by you will be the same, and the total interest paid to them will be £0.

It really doesn't sound like rocket science to me.