Direct debit - set up fixed amount, but took more

LMac

To meet the two DD min criteria for Halifax reward account, I set up a DD to pay off £5 fixed amount from my tesco cc every month. Not sure if it matters, but I clear the balance every month - once just after pay day and once before the balance is due. April statement gave a full balance of £18 with £10 min balance.

It said under the statement summary that the fixed amount will be withdrawn on 24/04/13. But instead they tried to take £10 (the min payment) which Halifax wouldn't pay as I only had enough for the two DDs (£5 for this plus £2.50 for the other DD) Halifax dont charge fees, but Tesco are charging me £12.

The new statement says the same under the summary except it also states £5 as the fixed payment.

When I called Tesco they said it says in the t&cs that even if I select fixed amount, they will still take the minimum amount if the fixed amount is lower. Anything I tried to ask, he just repeated "its in the terms and conditions"

I cant see this in any documents sent to me, or on the statement.

Can anyone show me this bit pls? I need to get a better understanding of how it works. If this is how its supposed to work, I think ill find a different place to send the DD

grumbler

LMac wrote: »

...I cant see this in any documents sent to me, or on the statement.

On their application page they say that you have to "Read & sign agreement" after receiving it together with the card.

I need to get a better understanding of how it works. If this is how its supposed to work, I think ill find a different place to send the DD

IMO it's a very logical way of working. You are probably the only customer wanting to make fixed payments smaller then the minimum payment.

LMac

But if I wanted to make the minimum payment then I would have chosen the "pay minimum payment" option...

But I see where you are coming from.

Buzby

Your DD was for 'unspecified amounts on unspecified dates' as is standard, so claiming any breach will be impossible. Only if you received an explicit confirmation of the amount to be taken, and they took a different amount, could you argue the case!

chattychappy

Moral of the tale is that if you want to retain full control of your money, then don't sign DDs. Everytime you want to make a payment then authorise the specific amount yourself. You then control both the amount of the payment and the timing.

DDs go back to an era when most people used cheques. Now there is a bit more choice - eg pay by debit card on the CC site or send by internet banking.

You could also consider a standing order - then a fixed amount will be sent periodically as you specify. The CC will have no say in the matter - your bank just pushes the money across. But bear in mind that you could be sunk if the minimum is higher (for some reason) or statement/due by dates shift such that the payment doesn't arrive during the required time.

Many people like DDs for paying CCs because they worry about forgetting. That's fine provided you understand how they operate and you remember to have the funds available to ensure they clear. I think they are more trouble than they are worth - but I'm in a minority.

grumbler

Buzby wrote: »

Your DD was for 'unspecified amounts on unspecified dates' as is standard, ...

What standard? And even if both can vary, the customer has to be informed about both well in advance.

[STRIKE]On second thought I think the OP can claim from the bank (not from Tesco) everything back under the DD guarantee if the bill really said 'fixed amount'. Tesco's T&C specify the amount, but don't override the DD guarantee obliging Tesco to inform the customer about the exact amount.[/STRIKE]

EDIT: on third thought there is no anything to claim from the bank as the DD was bounced and all charges were on the CC side .

dalesrider

grumbler wrote: »

On second thought I think the OP can claim from the bank (not from Tesco) everything back under the DD guarantee if the bill really said 'fixed amount'. Tesco's T&C specify the amount, but don't override the DD guarantee obliging Tesco to inform the customer about the exact amount.

Now there is a very good way to put Tesco in a good mood about the OP's account :rotfl:

OP has already incurred a charge as it is... Getting the DD reversed will just see even more.

I think the issue here could be that as the DD process is started days before it is taken and there had been no payments onto the account it may just default to taking the min payment.

Can't see why the OP does not simply make it a full DD and remove the need to make manual payments.

grumbler

dalesrider wrote: »

Now there is a very good way to put Tesco in a good mood about the OP's account :rotfl:

OP has already incurred a charge as it is... Getting the DD reversed will just see even more.

Who cares? I don't think that losing £12 will make them very unhappy.

I think the issue here could be that as the DD process is started days before it is taken and there had been no payments onto the account it may just default to taking the min payment.

Do you not see that the amount taken was bigger than the one shown in the statement? Any extra payments can only make it smaller, not bigger.

Gromitt

LMac wrote: »

When I called Tesco they said it says in the t&cs that even if I select fixed amount, they will still take the minimum amount if the fixed amount is lower. Anything I tried to ask, he just repeated "its in the terms and conditions"

To be honest, you don't even need the T&Cs - last time I edited my DD amount, it said on the website "Note that if the amount entered is less than the minimum payment your DD will be automatically increased to the minimum amount. If the amount entered is higher than your statement balance, it will be automatically reduced.". Did you not see this?

pqrdef

Of course, under the new Halifax rules, you wouldn't get the £5 Reward, because 2 DDs weren't paid out. Though they could have paid it, but they don't seem to have heard of the £10 buffer yet.

From 3rd June there's going to be a stream of postings complaining of rewards lost because DDs weren't collected, or were collected late, and it wasn't the poster's fault. And firms and charities etc that collect by DD are suddenly going to find themselves being held responsible for ensuring that people's Halifax rewards are paid. Crazy.

Buzby

grumbler wrote: »

What standard? And even if both can vary, the customer has to be informed about both well in advance.

The DD contract is standard, it gives the merchant unlimited access to the account holder's account. This has been the case since (a) dates and amounts could be specified by the account holder, only opting for unspecified if either were genuinely required to facilitate the debit. (b) the period for informing the customer was (from a rusty memory) reduced from 21 days to 10 and very recently to 7 (although I have yet to see this in writing). The issue is customers do not get even this level of notice, and in any event the instructions to process the debits are usually in place 3 days before the billing run and cannot be changed or altered as it is a bulk process.

If they advise a customer by (say) a letter on Monday, which is not delivered until Wed/Thursday there is no chance of preventing any debt timed for Friday or Monday, yet notice has correctly been given.

It is no surprise the consumer is left to sort out a mess not of their own making.