Direct debit vs manual payments

cnirving

Hi,


I'm a Halifax credit card customer, so am affected by the recent changes they have made to stop manual payments through the month altering your direct debit amount.



I enjoyed the flexibility previously available, so I am considering stopping my direct debit and paying off my credit card manually each month, and my question is whether there is a discernable disadvantage to this (other than the obvious 'you might forgot to pay it off one month'). E.g. is it looked on more favourably when being credit checked if you pay off your card via direct debit each month?

Thanks!

DCFC79

Whether you use DD or not isnt reported.

What if you forget fo pay it off ?

Just use direct debit.

K80_Black

I pay off my main credit card manually, and it's fine. I check all my accounts daily anyway, and have yet to forget. If you're similar, it should be fine. I do have a DD set up for the minimum to avoid fees if I suddenly get hit by a bus.

My card gets reward points (amazon) but has a lower limit than my monthly spend so I tend to pay it off a couple of times a month to maximise my points. If this wasn't the case, I'd probably just use a direct debit - though I have a couple of current accounts and it's often easier for me to just pay manually instead of making sure the money is in the right account. Pros and cons to each!

System

K80_Black wrote: »

I pay off my main credit card manually, and it's fine. I check all my accounts daily anyway, and have yet to forget. If you're similar, it should be fine. I do have a DD set up for the minimum to avoid fees if I suddenly get hit by a bus.

It does mean however you will be paying interest if you get hit by a bus. Minor issue but yeah. Might as well make the direct debit for full amount.

18cc

Yes I do the same as above

I have a direct debit set up for the minimum balance just in case I forget but normally when the balance gets a bit high I just make a faster payment from my acurrent account to the credit card on an ad hoc basis to keep the balance low

PRAISETHESUN

I'd recommend setting up a DD for the full amount unless you have a particular reason for it. As above though, I'd set up a DD for the minimum amount at the VERY LEAST and then make your payments manually minus this amount - this way you will never make a late payment. There will be some interest to pay if you missed a payment (which would also happen even without the DD set up) but there is no risk of any late payment markers being added to your account.

There is no difference to the bank or how they report to the CRAs if you pay by DD or manually - as long as they get their money they don't care how it is sent.

K80_Black

beany_bot wrote: »

It does mean however you will be paying interest if you get hit by a bus. Minor issue but yeah. Might as well make the direct debit for full amount.

As explained in my second paragraph, I have multiple current accounts cycling money to maximise rewards and interest. Whether I'm paying a bit of interest on a credit card or going into my overdraft as the money to pay it off fully is in the wrong account - I'm sure it'll be the least of my worries in the bus situation.

cnirving

Thanks for the replies everyone. I like idea of having a DD set up to make the minimum payment just in case. Like K80 Black I check my accounts regularly enough that it's very unlikely to be needed but good to have a fallback anyway.

18cc

Just a thought - I make sure that the CC takes a DD every so often as the DD will go inactive if not used for I believe 13 months.

Ergates

+1 for Setting up a DD for the minimum then clearing the rest manually.

Zero_Sum

Additional DD's are also quite useful if you play the current account tarting game