Returned Direct Debit

lloyd_c_85

Hi all,

Here's an odd one for you all, any ideas?

I have a credit card that I pay off in full, I do it weekly. But I also have a direct debit that pays off anything at the end of the statement month. At the beginning of the June (1st) I paid off a balance of around £2000 manually. Yesterday, the Credit Card company took a direct debit of that amount, as they obviously took a snapshot of the balance before the 1st. So, basically, I had paid £4000 for a £2000 debt. This took me into my overdraft, so I rang my bank who said as it was the same day, before 3pm, they could return the direct debit, me incurring no fees. My bank balance went back to its original amount, job done, I thought.

Today, I have a £2000 credit on my credit card. I rang them to cancel the direct debit and they said they could transfer it into my bank if I wanted.

Does anyone know if this will this just sort itself out, with the returned direct debit taking my credit card balance back down to zero? If not, this obviously isn't my money and I would feel uncomfortable having it. Therefore, if it doesn't, who do I need to contact, i.e. who's money is it?!

Many thanks in advance for your help!

jonesMUFCforever

The card balance will sort it self out within days.

Why or why pay manually when you have a direct debit in place - its plain stupid!
I would also expect the card to levy a bouncd direct debit charge on you.

Sorry not to be nice to a new poster .

lloyd_c_85

Well, I had to set up the direct debit when I got the credit card, I just didn't see any harm in covering myself to make sure I wasn't charged any interest if, for example, I went on holiday.

I prefer to pay manually as then I can see easily where my finances are at a glance at any point in the month, rather than having to get a calculator out, and take away the balance on my credit card from my bank balance. I use a credit card, not because I don't have the money in my account, but to protect myself, so that if my details get stolen, it can be dealt with easier. oh, and also, it's a cashback credit card.

jonesMUFCforever

Won't stop them charging you £20 or so for a bounced direct debit. How much will you have to spend to get that in cashback.
Why can't you see online your credit card statement and bank account balance.

cr1mson

To avoid this happenning I would suggest one of two things

1) Set up a spreadsheet or use some software to track your finances so you are not relying on looking at your bank balance.

2) Pay the weekly amount into a separate bank account and have the direct debit taken from there instead.

Both of these would mean you would also hang onto the money longer so can gain more interest on it.

Crimson

flexrider

cr1mson wrote: »

To avoid this happenning I would suggest one of two things

1) Set up a spreadsheet or use some software to track your finances so you are not relying on looking at your bank balance.

2) Pay the weekly amount into a separate bank account and have the direct debit taken from there instead.

Both of these would mean you would also hang onto the money longer so can gain more interest on it.

Crimson

These are very good ideas and on that note if you have microsoft office 2010 you can get the add(microsoft money i think its called) on from microsoft or use microsoft excel to track incomings/outgoings ect

I use it All the time for auditing reasons on business. failing that openoffice is a good free software also that can help

as for the direct debit i would agree with the poster above but have it set up weekly ect as a standing order to transfer from one account to another if you can.

david39

I don't know to which credit card you are referring but, with all three of mine I have an arrangement to take the minimum payment each month by DD.

On each of the statements it tells me that on such and such a date a sum (minimum payment) will be taken by DD and the T&Cs also state that this sum will be taken, irrespective of any other payments that may be made manually in the interim period.

The same would apply if the arrangement was for a DD to clear the whole sum each month.

If terms set out to you with the card company at the time of set-up were that you had to complete a DD mandate then that need only have been for the minimum payment.

If you want to continue clearing the balance with interim payments, you should change the mandate to cover minimum payment only which will then limit the size sum the company draw from your account in the future - you will, of course, have to pay the balance of the statement by the due date to avoid interest.

Personally, I would leave things as they are and avoid such complications.