Woodlands trust - 1p direct debit?

anon_ymous

Does any one know why they'd allow such a low amount? Surely it costs them more every month than 1p/month?

I guess it might cost £3-£5 to set the initial DD up, but even then they're waiting a very long time to get their money back!

00ec25

ask them ?

Aquamania

waqasahmed wrote: »

Does any one know why they'd allow such a low amount? Surely it costs them more every month than 1p/month?

I guess it might cost £3-£5 to set the initial DD up, but even then they're waiting a very long time to get their money back!

It would depend on their system and agreement to set up Direct Debits, but there is not usually any cost on the supplier to set up or cancel a direct debit arrangement (although there will be a cost to the supplier in so far of their own labour for the time of doing so).

The bank would typically charge a percentage of the collection amount, with a minimum & maximum cost - the minimum cost would indeed typically be more that 1p - more like 15-25p

However I have known some arrangements where large organisations collect vast quantities of direct debits that agree a fixed price with the bank/agent no matter how may many collections thay make - this is usually an individually arranged price based on anticipated total collection amounts.
Hence they would not pay anymore for someone that agrees to pay 1p per month.

It may be worth asking why a person would bother going to the trouble to donate to a charity 1p? As it will also cost the customer more than that to pay that amount by DD. OK, the customer may be getting 'free' banking as an individual - but the cost is coming from somewhere

(Possibly a MSEer who thinks they are being clever to get cashback/interest off a current account that requires a minimum number of DD's set up?)

But back to your question as to why a charity may do this? Well, once set up, the charity has the payer's details so they will probably try to keep asking the payer to pay more and more. That's certainly my finding whenever one donates to a charity via Direct Debit .
The contact details of anyone willing to donate, let alone someone who is willing to support their particular charity, is worth a lot more to them than 1p per month

Savvy_Sue

The whole point of a DD is that the Payee (in this case the Woodland Trust) can increase the amount at any time after giving notice.

So a DD for 1p won't necessarily stay as low as that ...

A Standing Order remains under the control of the Payer.