MSE News: Direct debit payments could save you £435 a year

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This is the discussion thread for the following MSE News Story:

"Many utility and financial firms offer discounts, or avoid adding charges, to those who pay using this method ..."

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  • JimmyTheWig
    JimmyTheWig Posts: 12,199 Forumite
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    Not paying your TV licence in one go can also mean higher charges.
    Is this true? We pay 1/12th the cost each month.
    Is this to do with paying half in advance and half in arrears?
  • molerat
    molerat Posts: 32,006 Forumite
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    For instance, paying for insurance every month rather than in one go costs more
    Not always. Please give factual information rather than red top headlines.
  • I think it is very wise to check the most suitable payment policy offerd by every company in order to avoid further dissapointments.:)
  • EmehEm2005
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    Is this true? We pay 1/12th the cost each month.
    Is this to do with paying half in advance and half in arrears?

    As far as I can see there are no extra charges for paying by various different methods, but you may have to pay the full fee of £145.50 at, for example, a PayPoint outlet or by phone with a debit or a credit card.

    See links below for further information
    https://www.tvlicensing.co.uk/pay-for-your-tv-licence/payment-methods/

    http://www.tvlicensing.co.uk/pay/payment-methods/viewpaymentcontent.aspx?id=pay1&iqdocumentid=pay1

    http://www.tvlicensing.co.uk/about/media-centre/news/tv-licensing-invites-18-million-customers-to-pay-NEWS11/
    Don't make old people mad. We don't like being old in the first place, so it doesn't take much to p*** us off.
  • EmehEm2005
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    Don't make old people mad. We don't like being old in the first place, so it doesn't take much to p*** us off.
  • EmehEm2005
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    molerat wrote: »
    Not always. Please give factual information rather than red top headlines.

    If you read the article you will see that there are a lot of "cans" and "coulds" ("For instance, paying for car or home insurance every month rather than in one go can cost more." "Direct debit payments could save you £435 a year.") which is standard practice in responsible journalism - unlike red-top newspaper stories.
    Don't make old people mad. We don't like being old in the first place, so it doesn't take much to p*** us off.
  • molerat
    molerat Posts: 32,006 Forumite
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    The article has been edited since my post, the quote I used is a cut and paste.
  • davidgmmafan
    davidgmmafan Posts: 1,459 Forumite
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    edited 7 September 2010 at 3:33PM
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    "For instance, paying for insurance every month rather than in one go costs more"

    is not that irresponsible when you consider some insurers advertize saying NO CHARGE FOR PAYING MONTHLY. Clearly it is a common practice.

    PS there should be a warning with this to state DD's can save money, but they can seriously damage your wealth if things go wrong. They are good savings if you are reasonably good at keeping an eye on things, if not you could find yourself in an unstoppable snowball of charges courtesy of your bank.
    Mixed Martial Arts is the greatest sport known to mankind and anyone who says it is 'a bar room brawl' has never trained in it and has no idea what they are talking about.
  • karatedragon
    karatedragon Posts: 1,148 Forumite
    edited 7 September 2010 at 4:25PM
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    Another way to save even more is by not paying by Direct Debit. By this I mean simply do not buy Sky, Cable, Phone. You will not only save the Direct Debit Saving but also the cost of the service too.

    Also you can negotiate with the provider. I will NEVER pay by direct debit but threatened to leave Vodafone due to a non DD charge. They gave me a reduction in line rental so I would stay and not have to incure the charge.

    Vodafone wanted to charge me £3.00 plus VAT to pay by Bank Transfer. How on earth does this cost £3.00? They even admitted to me that it does not cost anything for a Bank Transfer to go in their account.

    I think Non Direct Debit charges should be outlawed. You do not have multiple charges for items in shops. You do not have separate prices of items for paying by cash, credit card or debit card. Granted some places to levy a charge for credit cards but I am talking in the main.
  • Cardew
    Cardew Posts: 29,038 Forumite
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    I think Non Direct Debit charges should be outlawed. You do not have multiple charges for items in shops. You do not have separate prices of items for paying by cash, credit card or debit card. Granted some places to levy a charge for credit cards but I am talking in the main.

    I think you might be 'looking at this from the wrong end of the telescope'.

    With most companies the 'normal' or 'regular' price is for the 'pay on receipt of bill'. In the case of gas and electricity with quarterly billing this means you get 3 months credit.

    Because it suit companies to have regular cash flow and the accounts are simpler to administer, they offer a discount on the regular price.

    You have a choice - pay on receipt of bill and pay the full price, or chose to have a sizeable discount for paying by direct debit.

    The discounts normally dwarf any lost interest - so surely any money saver will elect for payment by DD.

    Also some bills are paid in advance e.g. Council Tax, Phone line rental and payment by DD enable you to spread this out.

    For me the sheer convenience of paying by DD(and saving in postage etc) means I pay by DD even if there is no discount.
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