Halifax Direct Debit, Will I Be Charged?

MarkyMarkD

Even if Halifax operate this "check twice" policy, it's NOT standard practice for other banks and it's not in Halifax's Terms & Conditions. As Regularsaver1 says, the money MUST be in the account by close of business on the previous banking day according to ALL banks' terms and conditions - otherwise they are within their rights to bounce the payment, and to charge you.

Putting cash in on the day the DD is due is too late, for all banks, according to their Ts & Cs.

Just because a bank lets you "get away with it" once, or even 1,000 times, doesn't mean they must always do so in future.

Alan_T_2

Alan_T wrote: »

I did some work on this sort of thing (automated payment authorisation and timing) for Halifax as part of one of the projects I was involved in a while back. The info below is the procedure as it used to be.

Direct Debits are treated differently to Standing Orders in Halifax. Without going into full detail (primarily because I can't remember all of it) the debit for a Standing Order is somewhere between 2-4am and if the money isn't there, a charge is applied However for Direct Debits a check is made at 2am for the funds, if the money is there ... great, if the funds weren't present another attempt would be made again around 5pm. Assuming the funds were there at 5pm the customer wouldn't be charged. If no funds are available at 2am and 5pm... then a charge is due.

I used the term used to above deliberately as I heard a story the other day that this might be changing (or have changed).

If I remember tomorrow I'll check on the latest position and update accordingly.

UPDATE

Did some checking today. My thoughts above were right on both counts. At the moment there is a second attempt made at 5pm for Direct Debits, however this stops next week (25th I think) in a move to bring HBOS in line with other banks (story I heard when checking is that there is an internal communication planned for tomorrow). As has been mentioned elsewhere this was not in the T&Cs as a feature of the account, I believe that it is a quirk of the aging system the accounts sit on.

Lady_K

Thanx for coming back with the info Alan I bet a lot of people will be caught out with this for a while if they have been used to putting the money in during the day of the direct debit

MarkyMarkD

... and the first time they query it, they'll be told that they were never complying with their Ts & Cs and Halifax will doubtless refund the associated charge (assuming the customer has not had DD rejection issues and charges in the past in any case). The second time they seek to rely on it, Halifax will NOT refund the associated charge because they'll have no reason to.

regularsaver1

I also saw this memo today:

(25th June) its the start of a six month programme of changes in an aim to streamline the way payments are processed across the banking industry.

It stressed the customers should be reminded that cleared funds should be in the account by 5pm the day before the payment is due.

To ensure payments are processed the first time at 3am , as apposed to current situation where the payment could be sent as the end of the day, so repeat requests will no longer be available.

It did say, if first charge, this could be reversed (as a result)


Lady K, I would think that they may write to people, but they might not either as they are not changes their conditions booklets, where it already said about funds being in there day before

Lady_K

regularsaver1 wrote: »

I also saw this memo today:

(25th June) its the start of a six month programme of changes in an aim to streamline the way payments are processed across the banking industry.

It stressed the customers should be reminded that cleared funds should be in the account by 5pm the day before the payment is due.

To ensure payments are processed the first time at 3am , as apposed to current situation where the payment could be sent as the end of the day, so repeat requests will no longer be available.

It did say, if first charge, this could be reversed (as a result)

Lady K, I would think that they may write to people, but they might not either as they are not changes their conditions booklets, where it already said about funds being in there day before

Often I put money in online by transfer to my account. If a dd debit is due out by 3am I do it the day before either during the day or at nightime or even after 12 midnight on the day of the dd so long as its in before 3am. Do you think they are saying 5pm the day before because thats when banks close?

I'm glad I found out now though as I have heard nothing at all, no letters or anything. I wouldnt risk it knowing that now though.

If its a 6 month program of changes I wonder what the rest is

gt94sss2

Lady_K wrote: »

If its a 6 month program of changes I wonder what the rest is

I presume its a reference to the same day/near real time bank transfers between different financial institutions coming into force in November 2007 (replacing the 3/4 days it currently takes to transfer money via BACS)

The rules relating to the clearing of cheques is also changing from then.

Regards
Sunil

Mark7799

Lady_K wrote: »

Do you think they are saying 5pm the day before because thats when banks close?

I'm glad I found out now though as I have heard nothing at all, no letters or anything. I wouldnt risk it knowing that now though.

If its a 6 month program of changes I wonder what the rest is

I think it is because of bank opening hours so people without on line banking are treated in the same way as those with the facility.

regularsaver1

Yes 5pm before because this is the end of bank working hours

I guess past 5pm is treated like a non-working day

the 6 month prgramme would not just be Halifax - I guess this in preparation for when the BACS times change as sunil says - so everywhere

Lady_K

So do you think if I forgot to transfer it over online before 5pm I'd get charged even though it would be in the day before still?

Do they stipulate this anywhere saying either in the bank or online?