Warning: Direct Debit Payments

leoleo73

With Barclaycard, and possibly other cards, they don't start collecting payments though direct debit until the due date of the statement that arrives after the direct debit is set up with your bank. This could be 2 months after your bank confirms the direct debit has been set up and even longer since you requested it.

I returned a direct debit form soon after my card arrived, a week later a statement arrived. A couple of weeks after that (and a couple of weeks before the due date) I checked the direct debit had been set up. The due date was Friday and this morning (Saturday) I spotted no payment had been made. I contacted them and was told this was in the small print, and that it was too late, a fine had been applied and the 4.9% balance transfer for life had been revoked.

I paid by debit card and they re-instated my balance transfer rate, but I'm not sure what happened to the fine, or my credit record.

A standing order may be a safer way to pay these low balance transfer rate for life cards since the payment is always around the same and there is less to go wrong.

Steve1963

I agree. Direct debits are a disaster waiting to happen. I pay all my cards by SO or direct payment via internet banking. I like being in control!

Steve

YorkshireBoy

leoleo73 wrote:

A standing order may be a safer way to pay these low balance transfer rate for life cards since the payment is always around the same and there is less to go wrong.

Never 'assume' a direct debit is set up.

You'll know it's set up when your statement says...

"Your payment of £xx.xx will be collected from your nominated account on xx/xx/xx."

Until you see this message on your statement, make sure you pay (in plenty of time) by other means.

gem4

ooerr....just off to check my bank account to see if my new Lloyds Platinum DD has been set up yet, first statement is due in 2 days. :eek:
Thanks for that. x

MarkyMarkD

Banks (and anyone else who collects money by DD) have to give the customer notice of the amount they are going to collect, so they can't implement a new DD on a credit card account instantly.

What's annoying is that virtually no bank allows you to set up the DD at the time of application, which would mean that payments could be collected by DD from the first statement onwards.

sicker

Me too. I like to be in charge of the dates I PAY, not the banks. Banks are too much in the habit of 'arranging dates in their favour'.

John

YorkshireBoy

MarkyMarkD wrote:

What's annoying is that virtually no bank allows you to set up the DD at the time of application...

Indeed, I seem to recall that Egg Money was the only card provider that let me choose my statement date (or payment due date - I can't remember which) during the application process.

...which would mean that payments could be collected by DD from the first statement onwards.

I've found the best way to (virtually) ensure that the DD is set up in time for your first statement is to request a particular statement date of your own choosing.

For example, if you call to activate the card on the 14th, then ask for your statement date to be set to the 13th of the month. That way, you're giving them a full 30 days to get the DD set up - which should be more than ample for most organisations.

Astaroth

Everytime I have setup a DD for a new credit card each of the issuers (and there have been many) have said 3 or 4 times to continue paying by my normal method until my statements say that the payment will be collected by DD. Have always done this and to date neve a late payment fee

gem4

Astaroth wrote:

Everytime I have setup a DD for a new credit card each of the issuers (and there have been many) have said 3 or 4 times to continue paying by my normal method until my statements say that the payment will be collected by DD. Have always done this and to date neve a late payment fee

Lloyds have set up my DD and it shows on my A&L acc where it will be taken from. The statement I received said that payment will be taken from my account by DD on 13th. It also says on the statement that 'Payment due by 13th'.
I was a bit concerned that both dates are the same since it normally takes a few days for it to transfer. This means that if its taken from A&L on 13th, it wont be in Lloyds until about 17th.......after the due date.

If they are asked to collect the payment by DD, and its all set up and in place, are they obliged to make sure the payment goes to my account on time?

Maid_of_Kent_3

I recently took out the M&S AndMore card. The DD was set up well ahead of the first payment being due. I bank with the ONE account so I could see on line that it had been set up

Astaroth

gem4 wrote:

If they are asked to collect the payment by DD, and its all set up and in place, are they obliged to make sure the payment goes to my account on time?

I think by the strictest application of the terms and conditions of a card that it would remain your responsibility to ensure that the card is paid on time but then in the real world I can see no card issuer ever applying late fees if the DD was successfully taken by them on the first attempt and due to their error it didnt arrive on time.