Surcharge for Non Direct Debit??!!

Zubergeek

I currently have broadband with TalkTalk, and they seem to want me to pay an extra £4 on top of my bill for not paying by direct debit. I pay ALL my bills by manual transfer, this makes sure they get paid, and that I don't get charged a bank charge if something should go wrong (I.E. there is a delay in getting paid from work or I miscalculate how much I actually have in my account) and allows me to correct it myself, again without getting bank charges.

Does anyone know what this 'Taxation' is for? Because to be honest, I'm not happy paying it as I feel that payment is payment, whichever way it comes. I know there is a fee from the banks for having a Card payment machine, which is understandable. But being charged for spending my time to actually make the payment??

Loughton_Monkey

Surprised you haven't seen this before. For years, Utilities and others are pushing for Direct Debit payments. This is understandable, since they are 100% automated and cost extremely little, if anything, to process. Cheques, BACS, etc. all take armies of clerks to process, reconcile, and deal with, especially when a high proportion pay late. Cost of reminders etc....

Most companies, though, dress it up as a 'discount' for Direct Debit. Talk Talk, it seems do it the other way and makes it a surcharge. Might be bad marketing, but it amounts to the same thing.

datostar

Virgin Media and BT also fine people for not paying by direct debit.

JuicyJesus

Sky charge you £4.50 for not paying by DD. I'm quite happy going by DD; I stay organised and reap the benefits of not having to do anything to pay my bills, and I get charged less into the bargain - not to mention, paying my electricity this way means there's only a flat sum coming out each month and no nasty surprises with large bills etc. I must save a good £50 a year this way. Quite why people still insist on paying any bills with cheques or cash in this day and age, especially when it directly costs them money, I have no idea - especially as if a Direct Debit goes wrong it is actually put right the very same day now thanks to the Payment Service Regulations.

That and I really hate having to queue behind some old biddy who wants to pay all their bills at the local convenience store by PayPoint

olly300

JuicyJesus wrote: »

Sky charge you £4.50 for not paying by DD. I'm quite happy going by DD; I stay organised and reap the benefits of not having to do anything to pay my bills, and I get charged less into the bargain - not to mention, paying my electricity this way means there's only a flat sum coming out each month and no nasty surprises with large bills etc. I must save a good £50 a year this way. Quite why people still insist on paying any bills with cheques or cash in this day and age, especially when it directly costs them money, I have no idea - especially as if a Direct Debit goes wrong it is actually put right the very same day now thanks to the Payment Service Regulations.

Direct debits aren't put right the same day.

This is due normally to banks giving customers misinformation.

JuicyJesus wrote: »

That and I really hate having to queue behind some old biddy who wants to pay all their bills at the local convenience store by PayPoint

The OP was talking about paying by electronic transfer i.e. BAC not by paying by cash or cheque so that point isn't really relevant.

OP if you don't want to pay a non-direct debit surcharge then choose a telephone/broadband company that doesn't charge one.

chris_m

datostar wrote: »

Virgin Media and BT also fine people for not paying by direct debit.

Don't be daft, it's not a fine by any interpretation.

It is a charge for a service - people generally want their utilities/services for as low a price as possible, to achieve that companies need to use the cheapest payment collection method. If some people choose to pay by a means that costs more to administer, then the companies, understandably, need to cover the extra cost so they charge a fee for that purpose. It's no different to companies charging a small percentage (can't recall what the max is) for paying by credit card when buying goods/services.

jonesMUFCforever

chris_m wrote: »

Don't be daft, it's not a fine by any interpretation.

It is a charge for a service - people generally want their utilities/services for as low a price as possible, to achieve that companies need to use the cheapest payment collection method. If some people choose to pay by a means that costs more to administer, then the companies, understandably, need to cover the extra cost so they charge a fee for that purpose. It's no different to companies charging a small percentage (can't recall what the max is) for paying by credit card when buying goods/services.

How can me paying electronically using their pay facility on their website cost more than them setting up a direct debit?

JuicyJesus

olly300 wrote: »

Direct debits aren't put right the same day.

Not true: I know with my bank for certain, due to the new Payment Service Regulations a bank is required to refund the amount of any unrecognised payment (be it debit card, direct debit or Faster Payment) before 4pm the same day unless they have evidence of customer involvement.

The OP was talking about paying by electronic transfer i.e. BAC not by paying by cash or cheque so that point isn't really relevant.

Pardon me, I was just having a vent there.

JuicyJesus

jonesMUFCforever wrote: »

How can me paying electronically using their pay facility on their website cost more than them setting up a direct debit?

It's not just the cost of processing the payment; people making payments by Direct Debit are far less likely to forget to make a payment, and if they cancel the DD the company is alerted and can take steps to ask what is going on. Both of these reduce costs. Think of a company with a customer base the size of, say, Sky - taken in aggregate the total amount they save by heavily emphasising Direct Debit over all other payment methods must be massive.

System

JuicyJesus wrote: »

It's not just the cost of processing the payment; people making payments by Direct Debit are far less likely to forget to make a payment, and if they cancel the DD the company is alerted and can take steps to ask what is going on. Both of these reduce costs. Think of a company with a customer base the size of, say, Sky - taken in aggregate the total amount they save by heavily emphasising Direct Debit over all other payment methods must be massive.

Perhaps...

I think it's partly to shift the costs of late payment towards the customer. If you don't have enough money to pay a direct debit, then you are charged by your bank from around £30 down til £5 a pop. More reputable companies would then contact you to see what is happening after a single attempt. Others such as BT will try to debit the account several times before they give up - making late payment very costly.

That happened to a friend when she lost her job, and she racked up several bank charges before she even knew it. I got her to cancel all her Direct Debit mandates.

datostar

chris_m wrote: »

It's no different to companies charging a small percentage (can't recall what the max is) for paying by credit card when buying goods/services.

Precisely. There isn't a max, though, and it's often not a small percentage, and catching on increasingly. Ryanair as the pacesetter, of course, with a charge of £5 per person per flight if booked in a single transaction. They're certainly not daft.