direct debit for private individual

olias

I pay a friend to look after my horse. The amount varies each month depending upon how much they have done. I don't always get to see them, so want to set up a direct debit so they can take the right amount at the start of each month.
How do I go about it? They have suppllied me with their account details.
Thanks

Olias

dr_adidas01

olias wrote: »

I pay a friend to look after my horse. The amount varies each month depending upon how much they have done. I don't always get to see them, so want to set up a direct debit so they can take the right amount at the start of each month.
How do I go about it? They have suppllied me with their account details.
Thanks

Olias

Private individuals can't set up direct debits on their accounts only companies can, so you as a private individual can't create a direct debit, and neither can the person who looks after your horse unless they are running looking after your horse as a business and have a business bank account?

You can however set up a standing order to automatically pay someone a set amount each month. Since i'm assuming you vary the amount of money you pay them each month this might not be practical.

Can you not just use the account details they have given you and send them a payment of the correct amount via Faster Payment via your own internet banking?

bsms1147

dr_adidas01 wrote: »

Private individuals can't set up direct debits on their accounts only companies can,

I'm sure there was a poster who posted here a few weeks ago with a method of setting up your own (ie, you as the originator) direct debit mandate, in that case to satisfy DD terms for current accounts, for a nominal fee per year. I'll take a look.

Edit: Gocardless was the name that was mentioned
https://gocardless.com/

Reports on the site of people using it to collect rent payments, etc.

Not sure how it would work since your friend would be the one collecting the money, they would likely have to be the one to set it up and pay the associated fees.

Atidi

bsms1147 wrote: »

I'm sure there was a poster who posted here a few weeks ago with a method of setting up your own (ie, you as the originator) direct debit mandate, in that case to satisfy DD terms for current accounts, for a nominal fee per year. I'll take a look.

Most unlikley an individual would be able to set themselves up as a Direct Debit Service User (Originator)

There are some services now being offered by third parties that essentially asks the 3rd party to collect money for you via their DD scheme (and then pays it to you). You'd need to check the terms of such a scheme to see if thats possible in this example.
The payer would, of course, have to accept the DD mandate in favour of that 3rd party.
I'm sure there's fees for such a service. It needs to be requested by the collector.

Atidi

olias wrote: »

I pay a friend to look after my horse. The amount varies each month depending upon how much they have done. I don't always get to see them, so want to set up a direct debit so they can take the right amount at the start of each month.
How do I go about it? They have suppllied me with their account details.
Thanks

Olias

You confused me with this.

Direct Debits are set up by the organisation that wants to be paid
i.e. it allows the Service User to collect money from others accounts.
A 'pull' system

The fact the intended recipient has given you their bank account details means they are expecting you to 'push' the transaction. i.e. pay them.

You can pay them by faster payments as and when required, or set a date in future to pay a certain amount (I think it then goes via BACS).

With all bank accounts I've come across, once you've set up the recipient initially within your online banking, it's very easy to then pay them varying amounts as and when you need to.

agrinnall

If your friend actually has the ability to set up DDs (perhaps because looking after other people's horses is their business and this is the way they get paid) then you don't have to do anything other than provide your friend with your sortcode and account details.

However, as the other posters suggest, it seems more likely that your friend wants you to send them the money each month. In this case, there's no way to pay variable amounts without manual intervention from you each time the amount changes. If it was me I'd agree a basic amount with your friend and set up a standing order to pay that at the start of every month, then when your friend advises you that an extra payment is needed, log on to your online banking and make a single payment of the extra amount.

jimjames

agrinnall wrote: »

If your friend actually has the ability to set up DDs (perhaps because looking after other people's horses is their business and this is the way they get paid) then you don't have to do anything other than provide your friend with your sortcode and account details.

However, as the other posters suggest, it seems more likely that your friend wants you to send them the money each month. In this case, there's no way to pay variable amounts without manual intervention from you each time the amount changes. If it was me I'd agree a basic amount with your friend and set up a standing order to pay that at the start of every month, then when your friend advises you that an extra payment is needed, log on to your online banking and make a single payment of the extra amount.

Sometimes the simple option is by far the easiest solution.

Rather than bothering with DDs and possible costs involved, this is a simple and easy way to sort the problem.

InsideInsurance

Being able to set up their own DDs is not a small undertaking and really is a non-starter unless he actually has a fully fledged business.

As already mentioned, there are third parties that will collect the funds for you and pass it on to you, similar to PayPal but without the payer having to give express consent to each payment. They would still need to follow the DD rules though in terms of giving sufficient notice of each transaction.

PayPal may be a route to look at as they can send you the request electronically and so you know how much to pay but, as with the above, they are going to have to factor in fees into their pricing. PayPal do offer reoccuring transactions too and it may be worth looking into how they work and if they can work with a varying amount.

Alternatively stick with the good old fashioned way, send out a bill and you pay it via your online banking etc

pacontracting

A direct debit is essentially giving the merchant carte blanche to your account. They can wipe you out.

To combat this, merchants sign up to the direct debit guarantee scheme and banks will refund the money in the event of an error (as most direct debit transactions are automated).

Just give your friend your username and password to your online banking system. It would amount to the same thing. (i.e. not very wise).

dr_adidas01

pacontracting wrote: »

A direct debit is essentially giving the merchant carte blanche to your account. They can wipe you out.

To combat this, merchants sign up to the direct debit guarantee scheme and banks will refund the money in the event of an error (as most direct debit transactions are automated).

Just give your friend your username and password to your online banking system. It would amount to the same thing. (i.e. not very wise).

Why is a direct debit giving a merchant carte blanche to your account?

I think you're creating fear where there is none to be created!!!

Archi_Bald

pacontracting wrote: »

A direct debit is essentially giving the merchant carte blanche to your account. They can wipe you out.

To combat this, merchants sign up to the direct debit guarantee scheme and banks will refund the money in the event of an error (as most direct debit transactions are automated).

therefore there is no carte blanche

pacontracting wrote: »

Just give your friend your username and password to your online banking system. It would amount to the same thing. (i.e. not very wise).

A userid and password is a million miles different from a sort code and account number. Sort codes and account numbers have been freely given out billions of times over the last several decades to total strangers (e.g. on cheques) and nobody has lost their bank balance because of this.