Direct Debit - Payment taken February but company goes into Administration in June and no refund!

doconnor07

Hi All,
Not sure the best place for this thread so thought bank accounts made most sense!
I had a Direct Debit setup with my dentist - who are part of a small chain. You pay £99 each year and this covers 2 check ups and 2 cleans over the 12 months. The money was taken in February 2020 for this year - and we had appointments booked in for late March. Obviously COVID comes along and the appointments were cancelled by the dentist as they were having to close for a period of time.
Today I try and contact them and cant get through - I search online and the website and phone numbers are all gone. More searching and it turns out the dentist chain entered administration 2 months ago (and never tried to contact us)
I have today tried to contact my bank for a refund of our 2 x £99 payments but they have said it doesn't meet the Direct Debit Indemnity Claim guidelines and only option is to pursue the administrators for our money back?

What is everyone's thoughts on this? Should this be covered and we be able to get a refund, or is Direct Debit actually much weaker for protecting your money than using VISA or Mastercard? 

Many thanks in advance!
Dan 

[Deleted User]

Yes, it's much weaker than debit or credit cards. The DD wasn't taken in error - it was the amount you agreed to.

You're at the mercy of the administrators.

Neil_Jones

In a nutshell, not the fault of the bank that the provider has gone under, nor could they have known the provider was going to go, so the bank has done nothing wrong.

Realistically once a business goes under the customer base are usually the last people to find out, because if you look at it from the employees point of view, "I've just been told the business is dead, so I'm out of a job as of that announcement."  Contacting the customer base is a duty performed as part of being employed by the company, so what usually happens is if the administrators are in the front reception and now calling the shots the business closes there and then and everybody gets sent home, they're not going to hang about for Mavis on reception to phone Mr Smith to tell him not to come in.  Because of lockdown this business termination would have happened remotely but its the same principle.

But yes, contact the administrators to see if you can be added to the creditors list.  But don't get your hopes up, many many more people/companies will be ahead of you in the queue, so don't be surprised if you get a grand total of sod all.

Thrugelmir

If the business has appointed administrators then the likelihood of any monetary recovery is zero. Preferential and secured creditors get the first bite of the cherry of what assets there are. 

born_again

doconnor07 said:

What is everyone's thoughts on this? Should this be covered and we be able to get a refund, or is Direct Debit actually much weaker for protecting your money than using VISA or Mastercard? 

Many thanks in advance!
Dan 

Yes & No.
As they cover different scenarios.
A DD reclaim has no timescale. As a easy guide a chargeback is 120 days.
But DD's do not cover non receipt of goods/service.

It's all swings & roundabouts.