Charged for paying bill "too early" (MBNA)

Chrism03

I have just changed bank accounts from Smile to Santander and I ran into a very frustrating issue.

</RANT>
I have a direct debit on my MBNA credit card for the full outstanding balance every month this is taken on the 19th (ish) every month.
I knew I was changing banks last month so I paid my outstanding bills to ensure no !!!! up (including a substantial balance on the MBNA credit card.)
I started the switch on the 1st on the month, all went well until today - I got two letters one from Santander and a bill from MBNA.

The letter from Santander was notification of a returned direct debit (for MBNA)
The statement from MBNA showed my payment of the full balance (~29th April) a direct debit payment for the full amount again (19th May) and a bounced payment fee of £12

Calling MBNA the upshot was it was my fault as I had paid my bill too early and their terms and conditions say I have to inform them if I do this (this has never happened before). They said sorry (nope not sorry - but as a good will gesture they would return the £12.)
I then rang Santander and was told I will be charged £25 for the returned DD and it will be logged against my credit rating, they could do nothing to help as it was the fault of MBNA.

I rang MBNA again and got told it was my fault for paying the bill too early (oh, and be the way lowering my spending limit / cancelling the card will also affect my credit rating.)

SO I have been charged £25 and had my credit record affected for paying a bill 20 days early and in full - way to go MBNA - 20 years a customer, card cancelled </RANT>

I feel better for venting, thanks for reading.

YorkshireBoy

PeacefulWaters wrote: »

You were paying in the accounting period relating to the previous bill. You made no credit to the account during the accounting period relating to the current bill.

That's what caused the problem.

I read it differently. OP paid the bill as soon as they received the statement, not before (there's under 3 weeks between the two dates mentioned).

However, because they didn't contact MBNA to suspend that month's DD collection, their systems still took it (as they say they will in the DDI paperwork sent to the OP...possibly 20 years ago though!).

cautiousjon

In order to help with DD and overpayment issues, if I make any additional payments to repay a statement balance early, I always make sure that I don't fully clear the balance and let the DD pick up the rest. I usually leave £20 - £100 to pay by DD.

However, it sounds like in this instance you have to tell MBNA when you make additional payments? If that's the case, I should make a point to never get an MBNA account. That isn't like how any of my other credit card providers process payments and DDs.

chattychappy

Yet another DD horror story.... for every thread where somebody has been hit with a late payment fee and told to set up a DD to prevent it happening again, we get a thread like this which shows how things can go wrong. And when they do go wrong, the charges/hassle factor can be higher because you dealing with two financial institutions. That is the real DD guarantee - Double Disaster.

SnowTiger

chattychappy wrote: »

Yet another DD horror story.... for every thread where somebody has been hit with a late payment fee and told to set up a DD to prevent it happening again, we get a thread like this which shows how things can go wrong. And when they do go wrong, the charges/hassle factor can be higher because you dealing with two financial institutions. That is the real DD guarantee - Double Disaster.

This seems like a charge for bouncing a Direct Debit. If the bank or MBNA have made a mistake the Direct Debt Guarantee can in used.

Not a Direct Debit problem, as such, because the Direct Debit wasn't paid.

So, this is another example of a problem that can occur when NOT paying by Direct Debit. :rotfl:

Whiner

Chrism03 wrote: »

I have just changed bank accounts from Smile to Santander and I ran into a very frustrating issue.

</RANT>
I have a direct debit on my MBNA credit card for the full outstanding balance every month this is taken on the 19th (ish) every month.
I knew I was changing banks last month so I paid my outstanding bills to ensure no !!!! up (including a substantial balance on the MBNA credit card.)
I started the switch on the 1st on the month, all went well until today - I got two letters one from Santander and a bill from MBNA.

The letter from Santander was notification of a returned direct debit (for MBNA)
The statement from MBNA showed my payment of the full balance (~29th April) a direct debit payment for the full amount again (19th May) and a bounced payment fee of £12

Calling MBNA the upshot was it was my fault as I had paid my bill too early and their terms and conditions say I have to inform them if I do this (this has never happened before). They said sorry (nope not sorry - but as a good will gesture they would return the £12.)
I then rang Santander and was told I will be charged £25 for the returned DD and it will be logged against my credit rating, they could do nothing to help as it was the fault of MBNA.

I rang MBNA again and got told it was my fault for paying the bill too early (oh, and be the way lowering my spending limit / cancelling the card will also affect my credit rating.)

SO I have been charged £25 and had my credit record affected for paying a bill 20 days early and in full - way to go MBNA - 20 years a customer, card cancelled </RANT>

I feel better for venting, thanks for reading.

Why have you used two "</Rant>"? This is not correct syntax for HTML.

You need to use one "<Rant>" to indicated the start of a rant, and then one "</Rant>" to indicate that the rant has finished.

I think I should point out though that "<Rant>" is not actually an HTML command, in case you were unaware.

Also, they make one mistake after 20 years and you drop them. Pretty unforgiving.

balmk

YorkshireBoy wrote: »

However, because they didn't contact MBNA to suspend that month's DD collection, their systems still took it (as they say they will in the DDI paperwork sent to the OP...possibly 20 years ago though!).

It does actually say on the first page of each monthly statement that the DD will be taken regardless of any other payments made: "The full payment of £XX will be collected from your nominated bank by Direct Debit on or after XX/XX/XX.
Please remember: your regular Direct Debit payment will always be taken, regardless of any additional payments you choose to make."

YorkshireBoy

balmk wrote: »

It does actually say on the first page of each monthly statement that the DD will be taken regardless of any other payments made: "The full payment of £XX will be collected from your nominated bank by Direct Debit on or after XX/XX/XX.
Please remember: your regular Direct Debit payment will always be taken, regardless of any additional payments you choose to make."

Yes I knew that, but couldn't find a link to the wording on here (it's been discussed many times!). But that statement (the bit you put in bold) isn't quite true, because you can stop them taking the DD, ie suspend it that month as I said earlier. When you set up or amend an MBNA DD they send you a letter which states...

MBNA wrote:

Important: Confirmation of the set-up of your Direct Debit Instruction

If you make manual payments to your account once the direct debit has been activated, these will not reduce the amount that we will collect by Direct Debit, unless you advise us at least seven working days prior to the Direct Debit being collected.

cautiousjon

balmk wrote: »

It does actually say on the first page of each monthly statement that the DD will be taken regardless of any other payments made: "The full payment of £XX will be collected from your nominated bank by Direct Debit on or after XX/XX/XX.
Please remember: your regular Direct Debit payment will always be taken, regardless of any additional payments you choose to make."

That's really poor. MBNA's systems should easily be able to take account of additional payments and amend the monthly DD accordingly. Barclaycard, Halifax, (previously) Lloyds TSB and (previously) Egg manage(d) to do this. It is not particularly complex?

bengal-stripe

cautiousjon wrote: »

That's really poor. MBNA's systems should easily be able to take account of additional payments and amend the monthly DD accordingly.(

But for everyone, like you, who complains the DD did not get amended, there is another one who complains that because of a previous payment the DD did get amended and so the payment was short of the full amount (they relied on the DD to be taken in addition to the extra payment). Which means, they haven't paid in full and are due to pay interest.

Half of the cards work one way and the rest works the other way. (Yes, it would be better if they all operated the same way, whichever that might be).

(Smart a**e mode on)
Hence it is always wise not to presume but to check by reading the small print.
(Smart a**e mode off)

Thrugelmir

cautiousjon wrote: »

That's really poor. MBNA's systems should easily be able to take account of additional payments and amend the monthly DD accordingly. Barclaycard, Halifax, (previously) Lloyds TSB and (previously) Egg manage(d) to do this. It is not particularly complex?

Nor is learning to read and comprehending.