Recurring Payments

Fergal1982

Just thought I would post this warning, so that everyone is aware of a potential pitfall around "Recurring Payments" on bank cards.

Last night, I noticed a £40 payment off my account from Microsoft XBox Live. Knowing I had cancelled the subscription, I was confused, but it turned out to be from the other halfs account. So I went on to cancel the subscription (and maybe try to get a refund if I could).

I noticed when I logged in, that the card on the account had expired in 2010! And they had been taking payments from it for the past several years without issue. It's not even the same card number as the one I currently have!

On contacting my bank, I was told that companies, when they take a subscription payment, can designate it as a "recurring payment". Apparently from this point, it doesn't actually need the card to be active to continue allowing payments to be taken. The adviser basically stated that it was "Like a direct debit".

However, it doesn't really appear in your account like a regular DD. i.e. if you go online, there isn't an area that lets you see these regular "recurring payment" subscriptions.

MS were great and processed a refund on the £40 (I'd been using it previous years, so didnt mind the other ones) - payment pending.

So, a word of warning to all: keep an eye on your account outgoings, and follow up on unexpected payments like this. You don't seem to be able to rely on the card being expired/cancelled for the payment to have disappeared.

pmduk

It's called a continuous payment authority. There are many warnings on here about them. The only reliable way of cancelling them is to write to both the supplier and your bank notifying both parties of the cancellation.

dunstonh

I noticed when I logged in, that the card on the account had expired in 2010!

Dates only apply to ad hoc purchases. Not continuous payment authority.

It's not even the same card number as the one I currently have!

Doesn't matter.

So, a word of warning to all: keep an eye on your account outgoings, and follow up on unexpected payments like this.

You mean, do what you should always have done and what most people do. Reconcile your statements.

Fergal1982

pmduk wrote: »

It's called a continuous payment authority. There are many warnings on here about them. The only reliable way of cancelling them is to write to both the supplier and your bank notifying both parties of the cancellation.

Ah. Yep, I see details of it now. including this

Still, pretty shocking that they are permitted to do it with expired cards.

dunstonh

Still, pretty shocking that they are permitted to do it with expired cards.

It's not shocking. Your bank details don't expire and the point of a CPA is that it is continuous.

grumbler

Fergal1982 wrote: »

Still, pretty shocking that they are permitted to do it with expired cards.

Not really.
Even for normal transactions retailers have up to 6 months to process them. What would happen if the card expired or was cancelled meanwhile?

Fergal1982

dunstonh wrote: »

It's not shocking. Your bank details don't expire and the point of a CPA is that it is continuous.

Sorry, but I completely disagree. A DD is against your bank details, but a CPA is against the card details you specify. If something you use to buy things has an expiry date, then anything using those details as a mechanism for payment should be bound by that expiry date.

Just because something is allowed, does not mean that it should be allowed.

At the very least banks should be required to show you these in a similar fashion to DDs, so its more immediately obvious what CPAs you have active.

Fergal1982

grumbler wrote: »

Not really.
Even for normal transactions retailers have up to 6 months to process them. What would happen if the card expired or was cancelled meanwhile?

When a transaction takes place within the expiry period, but theres a delay in processing it, fair enough. But when the transaction takes place after the expiry, no, I think it should be rejected.

Even so, a 6 month lee-way is perhaps acceptable. But 5 years?

Westie983

Fergal1982 wrote: »

At the very least banks should be required to show you these in a similar fashion to DDs, so its more immediately obvious what CPAs you have active.

They do its on your statements under DEB (debit card transaction) rather the DD.

If you had been checking their statements regularly and reconciling them then you would have know about the CPA for Microsoft Xbox live

Westie983

Most memberships are paid via CPA and is detailed in the T&C's of the product or website, this means it is continuous until cancelled this is done by contacting the company to cancel membership and is different to DD as they are canceled by the bank without having to contact the company...

This is why these membership companies use CPA over DD, as you are agreeing to a continuous contract until the expiry date or you cancel the membership.

You are able to cancel CPA via your bank by getting the telephone number for the specialist team who deal with cancelations, or like you have done contact the original company and end the membership.

Fergal1982

Westie983 wrote: »

They do its on your statements under DEB (debit card transaction) rather the DD.

If you had been checking their statements regularly and reconciling them then you would have know about the CPA for Microsoft Xbox live

Maybe it needs pointing out, but I do check my statements regularly. I noticed this now, because i thought had cancelled the payment and it showed up.

What I didn't notice, was it using a 5-year-expired card. What I didn't realise (and the whole point of this thread), was that they are permitted to claim payments on expired cards.

Again, just because it is allowed, doesn't mean it should be allowed.