Paying by direct debit

Zedicus

I recently set my NatWest credit card to payment in full by direct debit as I always pay it in full and it should save me a job.

When setting up the DD I was asked what date I would like to make the payment and selected 'Due Date'.

I expected them to take the payment on, well, the Due Date (or possibly the day before) as it appeared on my statement.

I was surprised to see that they actually took it nearly a fortnight ahead of this date. The next statement also shows that they are planning to take the payment well ahead of the due date.

Is this normal practice for CC companies?

[Deleted User]

It varies. But it will always need to be in advance of the due date, to allow time for it be credited correctly to your account. And potentially allow time for a second attempt if the first one fails.

wannabe_credit_free

I think it depends on when your purchases are due to be paid in the accounting cycle. Not entirely sure, but no doubt someone will come along soon, who can't wait to correct me...lol

nidO

This is normal, as zx81 says it's basically to allow time for things to happen - The CC company will normally need at least a working day or two to actually allocate a payment to your account once they receive it, and they take direct debits enough in advance that if it fails for any reason you have time to sort the problem out and get payment to them, without risking late fees, markers on your credit file, etc.

Between myself and my partner we have credit cards which are setup to automatically pay in full every month by direct debit with 4 different providers, and all 4 of them claim the direct debit 10-14 days ish before the statement due date (looking over my statements its usually around 10-12 days for Natwest specifically).

anamenottaken

My current experience is that Halifax and Barclaycard payments go out of my current accounts on the due date given on the statement and that Capital One (Luma card) comes out of my account a couple of days before the due date.

I'd be surprised if the reason for requesting the direct debit earlier is so that if it fails there is time for the cardholder to make alternative arrangements to pay in time. It's up to the cardholder to make sure there are funds there and it would be to the CC company's advantage for it not to be paid in time - more interest/charges for them.

SnowTiger

Zedicus wrote: »

I recently set my NatWest credit card to payment in full by direct debit as I always pay it in full and it should save me a job.

When setting up the DD I was asked what date I would like to make the payment and selected 'Due Date'.

I expected them to take the payment on, well, the Due Date (or possibly the day before) as it appeared on my statement.

I was surprised to see that they actually took it nearly a fortnight ahead of this date. The next statement also shows that they are planning to take the payment well ahead of the due date.

Is this normal practice for CC companies?

No, it isn't normal practice in my experience.

Natwest penalises customers who pay their credit card balance in full by Direct Debit by collecting the payment about two weeks before the due date.

However, the DD collection date is printed on statements.

A work around is to make the payment manually, possibly having set up a DD for the minimum amount as a safety net. This will be taken closer to the due date.