Honouring Cancelled Direct Debits

izools

Just got off the phone to my bank who told me that even though I have instructed them to cancel the direct debit, if the company claim for funds under the cancelled instruction the bank may charge me if insufficient funds are present to cover the debit...If this is true, what's the point of cancelling a DD? Surely this isn't right. I've made a complaint about it as I don't think this is right but I am happy to stand corrected if needs be

jonesMUFCforever

You will not be charged for a cancelled d/d.

However if you miss a payment to a creditor they may well charge you for a missed payment.

exel1966

izools wrote: »

Just got off the phone to my bank who told me that even though I have instructed them to cancel the direct debit, if the company claim for funds under the cancelled instruction the bank may charge me if insufficient funds are present to cover the debit...If this is true, what's the point of cancelling a DD? Surely this isn't right. I've made a complaint about it as I don't think this is right but I am happy to stand corrected if needs be

One of the reasons why it stated on the DD guarantee that the company should also be advised of a cancellation, not just the bank.

The company will still have every right to attempt to take the funds if you haven't advised them. In theory the bank shouldn't let the DD be paid if they've updated the systems in time, but that isn't always the case.

Regardless, the bank cannot charge you.

izools

As I thought.

They aren't creditor DDs but one of the companies, that I've informed, along with all the rest of my alternate account details, stated there's nothing they can do to stop their system automatically trying for the DD on the 25th.

If I have instructed the bank to cancel said DD they CAN'T honour the payment, can they?

I'm sure it was just the agent talking tripe but she confirmed with her TL that she has to tell all customers cancelling DDs of this possibility...

Paul_Herring

If you've left insufficient time (around 3 working days) between the date you canceled the DD and the date the DD is due, the DD may still go out leaving you liable for any unauthorised OD charges.

If you've given reasonable time (which you appear to have,) then the DD should not be paid out. If it is, you have grounds under the DD guarantee scheme to claim the money back (and any bank imposed charges.)

(Not applicable to you, but...) some companies will, but shouldn't, re-instate canceled DDs using AUDDIS. Again, you would have grounds to claim back.

As pointed out earlier (but, again, would appear not applicable to you,) the recipient may make a charge for a failed DD.