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Direct Debit Payments into Savings Accounts

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Direct Debit Payments into Savings Accounts

edited 30 November -1 at 12:00AM in Savings & Investments
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Special_Saver2Special_Saver2 Forumite
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edited 30 November -1 at 12:00AM in Savings & Investments
A quick question for those of you who make payments into savings accounts using direct debit mandates.

Do you get interest for the days when the money is in transit?

I have read some posts stating this whereas payments by the BACS system result in 2-3 working days lost interest.

What is your experience?

Replies

  • jamesdjamesd Forumite
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    With the direct debit method the money to the savings account is never in transit so it's not a factor. It leaves the account it's going from and arrives at the savings account on the same day.
  • scoot65scoot65 Forumite
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    jamesd wrote: »
    With the direct debit method the money to the savings account is never in transit so it's not a factor. It leaves the account it's going from and arrives at the savings account on the same day.

    So, it looks like having a DD mandate is much better than having cash moved from one account to another via 'payment transfer' as this takes 3 to 4 days (I assume with loss of interest).

    I have three Reg Saver accounts which I feed via transferring from my feeder account.

    Looks like I need to change tranfer to DD mandates in order to not lose any interest?
  • Can you make a one-off wired transfer from 1 current account to another current account for free?
    How long before the money being transfered is 'cleared funds' so it can be withdraw from the receiving account?
    "Not setting your clock forward and arriving an hour late to work is no excuse" The Boss' words - not mine!
  • DeepSporranDeepSporran Forumite
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    scoot65 wrote: »
    I have three Reg Saver accounts which I feed via transferring from my feeder account.

    Looks like i need to cahnge tranfer to DD mandates in order to not lose any interest?

    It would be nice if this were possible.

    However, it would require the Regular Saver building society or bank to raise the DD each month requesting the payment from your feeder bank, and there are not many (if any ?) that will do this. So you're stuck I'm afraid. Things will improve next year when transfers become 'same day' rather than taking (at least) 3 days.
  • scoot65scoot65 Forumite
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    It would be nice if this were possible.

    However, it would require the Regular Saver building society or bank to raise the DD each month requesting the payment from your feeder bank, and there are not many (if any ?) that will do this. So you're stuck I'm afraid. Things will improve next year when transfers become 'same day' rather than taking (at least) 3 days.


    Thanks for the info DeepSporran. I'll stick with what I'm doing.
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  • jamesdjamesd Forumite
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    scoot65, yes, it is possible to arrange regular direct debit transfers or one-off direct debit transfers into a savings account. It's just a question of what options your savings account provider offers. Just try setting it up and see if they offer monthly or for x months options. Icesave and Bradford & Bingley both offer the regular direct debit monthly deposit option.
  • jamesdjamesd Forumite
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    thebeak, not free if you want same day, yes free if you want normal three day clearing. Time for the funds to be funds you can draw on will depend on the receiver, likely to be a week or so at present.
  • Special_Saver2Special_Saver2 Forumite
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    For regular savings accounts (i.e. those which require a monthly deposit), the Monmouthshire BS Saver Plus and the Britannia BS Fixed Rate Regular Saver Issue 2 operate by direct debit.
  • Thank you for your answer jamesd. If you were expecting money to be paid into a current account how would you know when its 'cleared funds'?
    Would it only come up as balance at an ATM when the funds are cleared? Or would you need to check with the branch when the funds are cleared so u can withdraw?
    "Not setting your clock forward and arriving an hour late to work is no excuse" The Boss' words - not mine!
  • jamesdjamesd Forumite
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    thebeak, you'd have to check with the receiving bank. How they display and handle the usual BACS transfers varies.

    If you went with the same day CHAPS transfer option I doubt that any bank would have a delay before availability, because a CHAPS transfer is irrevocable.
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