Warning! BT increase charges for non direct debit payers

BritBrat

Sorry I still dont get it.

At the moment, someone on monthly billing pays £1 more per month than someone who pays by DD (£12 instead of £11).

At the moment, someone on quarterly billing pays £3 more per quarter than someone who pays by DD (£36 instead of £33).

Is that not the same cost? ie £1 per month or £3 for 3 months.

The new charges mean you will pay £1.50 per month (i.e. an extra 50p) more than someone who pays by DD (£12.50 instead of £11).

The new charges mean someone on quarterly billing will may £4.50 per quarter (i.e. an extra £1.50) more than someone who pays by DD (£37.50 instead of £33).

Is not 1 X 3 = 3, i.e the same total.

If paying a 3 monthly bill cost £4.50 X 4 = £18 a year, then the cost for paying monthly should be £4.50 X 12 = £54 per year. Assuming it costs £4.50 to process a non DD payment.

Why would one payment cost more or less than any another payment using the same method.

Heinz

Yes, but I thought you thought you should be paying 4 times more because you pay monthly. You shouldn't and you won't.

BritBrat

Yes, but I though you thought you should be paying 4 times more because you pay monthly. You shouldn't and you won't.

No I never thought that.

Do you see what I am getting at?

They must either be charging quarterly payment more than it costs or charging monthly less than it cost.

Or what I think they are doing is charging more than it costs to everyone.

Lets know the real cost involved between DD and online banking and I will pay the difference, I have no issue with that but I cant see it being £4.50 more to process a online payment than a DD payment.

helenlou_3

russetred wrote: »

I can't remember precisely but doesn't BT have a minimum amount you can pay by DD.When I switched phone provider I wanted to remain paying BT by DD for basic line rental but I seem to remember it wouldn't accept the £11 a month it had to be a higher figure does this ring a bell with anyone else.Looks like I will have to phone them, what fun!

I pay for only my line rental by DD but it has to be the full amount which is approx £37 a quarter. BT didn't give me the opportunity to spread the cost over the 3 month period.

trelfa1966

I would have thought that these charges for non direct debit payment are more than the actual cost that they would have to pay, administration wise, a bit like the overcharging the banks have recently had to pay back to its customers. Maybe Martin could look into this.

trelfa1966

MOONBEAM wrote: »

BT have received all this bad press for something that other companies have been doing for years. The impact of this charge will only be 1.50 as BT is lowering the line rental charge by a pound a month, so there will be a saving of 3.00. BT offers 46 different ways to pay your phone bill and they are not forcing you to pay by Direct Debit, other companies will not even speak to you if you do not pay by this method. If you have a line and broadband service with BT you actually make a saving of 50p a month if you pay by direct debit

Now you say you save 50p a month if you pay by direct debit, when in actual fact you should be saving what non direct debit customers are paying and that is not 50p. But that is not the point here, the point is, even though people who are in credit that don't pay by direct debit are charged for it. Bt has a lot of different ways to pay your bills but all of these will have a charge put on them. How would you like to have a charge put on your bills for PAYING THEM. It should'nt matter how it is payed as long as it is payed. It only seems like a small charge but as Tesco put it: " EVERY LITTLE HELPS " and look at the profits they make.

Heinz

trelfa1966 wrote: »

It only seems like a small charge but as Tesco put it: " EVERY LITTLE HELPS " and look at the profits they make.

And they should know - they impose a 'Direct Debit Failure Charge' of £5 for Tesco Home Phone!

Ongobay

If BT get charged approx £10.49 a month from openreach for line rental for each customer then it doesn't leave a huge profit margin for them for each customer.

If you pay by cheque they have machinery dedicated to opening the mail, checking which customer the cheque belongs to and crediting the account. Some people put letters with their payments, or miss off information, so this then requires staff to go through rejected letters and see why it has been rejected and action it accordingly. All that requires rented/bought space, staff wages, heating & standard bills, time & effort. Plus the charge BT will have from the bank for processing the cheque.

If you pay via payment card then BT are charged on every payment, from the £5 per week some pay, to the full amount others pay. This involves printing & dispatching a card, and free replacements. As well as procedures to look into 'missing' payements and staff to look into those.

Customers paying via credit or debit card may want to speak to a 'real person' over a machine. This all has 'wasted' costs to BT.

Statistically customers not on direct debit have a higher chance of not paying the bill on time, and needing postponed payments, and payment plans. BT still have to pay their bill to openreach on time.

With DD there is a better chance of payment in a regular and expected fashion. While bt 's actual cost from the bank etc for processing the none DD payment might not be the 50p per month, they then have the staff, premisis & expenditure that goes with those particular payments which all add up.

Plus *alot* of people call in with "Have you received my payment I made via online bank transfer/card payment/cheque" etc. This all adds up.

Most companies won't accept none DD payers, and charge alot more. For BT to be a moneysavingexpert they need to pass on their costs.

Why isn't there a movement to send Virgin a letter to prove their £5 per month charge, or to TalkTalk to have them explain why they think it's better to reject the none dd payer?
I know.. BT have a social obligation. But they do still provide LUS/ICP shortly to be replaced by BT Basic for those most vulnerable. Noone else does that.

*Deep breath* YES I do work for BT - NO I don't think the new charge is fair, but I also don't think it fair for anyone else to pick up the bill on those costs.

gem4

I'm not a BT customer and so I'm not affected by this but for what its worth, here is my opinion on the matter.

There is a big difference between:-
a) telling someone they will be charged for not doing something
and
b) offering a discount as an incentive to do something

If someone tried to force me to do something - I would refuse.
If they asked me to do the same thing - I would consider.
If they offered a discount for doing it - I would likely agree.
It's basic human nature.

Most people handle their bills responsibly and pay on time, so the way they pay their bill should be their choice. As I see it BT and others are charging everyone who doesnt by DD a fee to compensate for their reduction in profits, caused by the people who do not pay on time or who, heaven forbid, may need a little 'personal contact' from a BT 'customer service' employee. This is unfairly penalising people who pay on time by their preferred method.

Instead of throwing their weight around they should offer incentives in order to get the results they want. This heavy handed manner is merely causing a consumer revolt. IMHO

The_Economist

Ongobay wrote: »

If BT get charged approx £10.49 a month from openreach for line rental for each customer then it doesn't leave a huge profit margin for them for each customer.

If you pay by cheque they have machinery dedicated to opening the mail, checking which customer the cheque belongs to and crediting the account. Some people put letters with their payments, or miss off information, so this then requires staff to go through rejected letters and see why it has been rejected and action it accordingly. All that requires rented/bought space, staff wages, heating & standard bills, time & effort. Plus the charge BT will have from the bank for processing the cheque.

If you pay via payment card then BT are charged on every payment, from the £5 per week some pay, to the full amount others pay. This involves printing & dispatching a card, and free replacements. As well as procedures to look into 'missing' payements and staff to look into those.

Customers paying via credit or debit card may want to speak to a 'real person' over a machine. This all has 'wasted' costs to BT.

Statistically customers not on direct debit have a higher chance of not paying the bill on time, and needing postponed payments, and payment plans. BT still have to pay their bill to openreach on time.

With DD there is a better chance of payment in a regular and expected fashion. While bt 's actual cost from the bank etc for processing the none DD payment might not be the 50p per month, they then have the staff, premisis & expenditure that goes with those particular payments which all add up.

Plus *alot* of people call in with "Have you received my payment I made via online bank transfer/card payment/cheque" etc. This all adds up.

Most companies won't accept none DD payers, and charge alot more. For BT to be a moneysavingexpert they need to pass on their costs.

Why isn't there a movement to send Virgin a letter to prove their £5 per month charge, or to TalkTalk to have them explain why they think it's better to reject the none dd payer?
I know.. BT have a social obligation. But they do still provide LUS/ICP shortly to be replaced by BT Basic for those most vulnerable. Noone else does that.

*Deep breath* YES I do work for BT - NO I don't think the new charge is fair, but I also don't think it fair for anyone else to pick up the bill on those costs.

I pay my bill quartely and do not think i should be forced to pay it by DD. I do not have cable in my area so have to stay with BT. I have over heads to, i have to put food on the table run a car pay other bills. I cannot go to my employer and start charging him/her for admin fees etc etc. I dont think it is fair that BT is going to charge this. As an adult with a family i have to act as a Bank manager as an accountant as a builder as a car mechanic and so on but dont get paid for it. Nobody cares about my profit marigin. I think the whole idea should be dropped now.