Is it reasonable to be charged for this?

corbyboy

I have an MBNA credit card. At the beginning of last month I paid a big chunk of it off. After that payment had cleared, my online statement still said they were going to take out my regular direct debit (just the minimum payment) at the end of last month.

I had budgeted to make this large payment, but not the DD as well, so I cancelled the DD through my bank. I didn't tell MBNA that I had cancelled the DD.

This month they have slapped on a £12 fine for "Return Pymt Default Sum." This is all the information they give me about it.

Does this seem a reasonable charge? The DD didn't bounce as such, it was cancelled. And I have made sufficient payment to the account.

digitalphase

If you still owe money on the account, you still have to pay, whether that be by direct debit or a one off payment each month. You can't just cancel the direct debit and expect them to forget about it.

Are you on a 0% deal or are you paying interest? If so, even if you cleared the whole balance chances are you'd have to keep the direct debit set up until at least the following statement due to trailing interest.

If it's a first 'offence' they may be willing to refund the charge, but ask them nicely or they won't

ETA: what date was your minimum payment due by and what date did you pay that sum of money? Was it designed to pay more than the minimum amount for that month?

bengal-stripe

corbyboy wrote: »

...I paid a big chunk of it off. After that payment had cleared, my online statement still said they were going to take out my regular direct debit (just the minimum payment) at the end of last month.....so I cancelled the DD through my bank. I didn't tell MBNA that I had cancelled the DD.

That is the system MBNA works. Once you have set up a DD and the statement is compiled the DD gets activated and hangs around for a couple of weeks until it gets send out. Even if you had paid the full balance, the DD for the minimum would still be collected, unless it was manually pulled out of the system.

In your case, you expect the people of MBNA to be mind readers. Many people have DD for the minimum and pay additional chunks of money (as they do not want to commit themselves to a DD for the whole balance). You pay a chunk (not even the balance, I believe), but you do not want to pay the minimum payment on top of that. Fair enough, but how is MBNA supposed to know? You could have phoned them and asked for this month’s DD to be cancelled. That could have easily been done, although they need a week or so before the DD is due. Why did you fail to contact MBNA? There seem to have been plenty of time. Again, how is MBNA supposed to know your intentions?

Just phone them up nicely, talk about ‘failure of communication’ and ask for the charge to be refunded. They might agree to that or they might not. But do not come along high-and-mighty (gently does it), after all, it was solely your fault.

gowgowuk

Hi,
I just had a similar experience... Because I'm switching current accounts and direct debits, I made my credit card full payment manually well in time. My direct debit payment was rejected (as I feared) but I thought I would be fine since the payment has been made manually. However, they still charged me £12 for administration costs, even though I was in credit all along.
I called them yesterday and, as you said, asked nicely, and they reinbursed the £12 today.

Moggles_2

The effect of a manual payment, when a direct debit is active on your account, varies between lenders.

The variations I have encountered are:
1) the direct debit is recalculated if a payment is made at least x days before the DD is due [eg. Capital One, Egg]
2) If a manual payment is made, regardless of the amount, no money is taken by DD that month. [eg. Barclaycard]
3) No account is taken of any payment made. The amount specified on the statement is automatically collected by DD unless instructed otherwise [eg. Co-Op, MBNA, RBS].

Sammy_Girl

Call up MBNA and be nice and apologetic and explain the error and they will refund the £12.00. Similar thing happened to me and it was no problem to refund the charge.

corbyboy

Thanks for the feedback everybody.

The problem I had was I don't understand why that is a justifiable reason to charge me. If a direct debit is not sent, does this cause MBNA some hassle? Does somebody have to look at it and investigate it?

If so, I understand that it's my fault and the charge seems justified.

b3nton

Just give them a call, I'm sure they will refund the £12

noh

If you read the "Making a Payment" section on the last page of your MBNA credit cardstatement it says :-

"Direct Debit
Your Direct Debit payment will be taken regardless of any additional payments you make........"

In the Information table it says under Default charges:-
"£12 each time for going over your credit limit, paying late, or payments that bounce."

As others have said your mistake was in not informing MBNA that you had cancelled the DD.