Credit card full direct debit amount not taken

The_Don_13

Hi all

I admit not a frequent contrubutor!

Apols if this has already been raised before, but pls see above!

Has anyone else found that what seems to be the practice of all credit card companies not taking the full amount as per the previous months statement by DD to be a right pain!? This is despite clear instructions that the full previous months outstanding balance is always to be claimed by DD.

 For example I recently was searching around the market to renew car insurance for both our cars. As said providers kept on hiking up the price considerably (when adjustment was made for my wife's not so recent accident record in her car,, forgotten on initial quoting etc) which led to me cancelling the policy before they had even begun. The credit refunds are then taken as a manual payment and they are offset against the previous months direct debit. BUT, this just leads to a much smaller DD amount being taken, which then means the following months bill is much larger. Santander saw fit to only debit £66 due to refunded credited insurance premiums when the actual balance from previous month statement was £615. So unless one makes a manual payment for the difference, the £550 approx gets rolled over to the following month, so really & easily screwing up cashflow.

Similarly we actioned a balance transfer from Halifax cc to int free Sainsburys bank cc and it was so large, that Halifax didn't claim anything by DD, which again just leads to a large 2 month worth balance the following month!!

Anyone else think this practice is crackers?....the full DD amount from previous months statement should be claimed by the bank etc each month, regardless of any refunds, manual balanc transfers etc.

eskbanker

Doesn't seem 'crackers' to me, no, and there have been posts before from cardholders who were outraged with providers who do take a DD based on statement balance without adjusting for refunds, so if that's how you'd prefer it to be, use one of the cards that works that way (they're not all the same).  I don't recall which do and don't, but you might find more info on the credit card board....

grumbler

Yes, this is a common practice that manual payments and refunds made after the statement was produced usually reduce the DD unless they are made very close to the DD date.

Anyone else think this practice is crackers?....the full DD amount from previous months statement should be claimed by the bank etc each month, regardless of any refunds, manual balanc transfers etc.

With regard to refunds - maybe, but certainly not for manual payments.

AmityNeon

What's wrong with extending your interest-free period for transactions? A larger payment the next month is immaterial. You may have extra cash for a month, but it's not cash you can spend; it's already spent as far as budgeting is concerned, so keep it in the highest interest-bearing easy-access account you can.

I would much rather pay as little as possible for as long as possible as long as no interest is incurred, which happens to be the underlying principle of stoozing.

grumbler

Many people even abuse/exploit this. Instead of making minimum payments they buy and return things for a refund.

Not that I'm a big fun of people making minimum payments, not full.

The_Don_13

Hi all,

Not sure if this topic has come up before, so apologies if it has, but....

Does anyone else disagree with what seems to the banking industry policy of credit card companies failing to collect the full amount owed from the printed previous months statement. I simply want the banks to collect the full balance as shown on the previous months statement by DD each month, regardless of any credit or refunds in that following month. This then will regulate cashflow and not lead to a much larger (sometimes eg double) balance to be paid the following month. If a customer requests the full amount to be paid by DD, then that is what they expect to happen....regardless of any credits which are just zeroing out the amounts already debited to the account. My eg is shopping around for car insurance at a reasonable premium.  3 x car insurance policy payments were debited prior to the renewal date. I then found a better price from a 4th company, again before the renewal date, so I cancelled the more expensive policies before the live date & the amounts were duly refunded on to the credit card as expected correclty, BUT these zeroing credits then mucked up the DD taking the full amount from the previous months statement. This then mucks up customers cash flow as they end up having double the amount to pay the following month.

Banks know where payments are made, time, location, amount etc of the transaction, so it just requires a programming change to recognise that the refund is simply zeroing out the original debit. A refund/credit for a previous same month debit should have no bearing on the previous months dd amount.

Most people (certainly those who never want to pay interest charges & responsibly budget etc, live within means etc etc) have their DD set up to pay the full DD amount from the previous statement. When that fails to happen, it is almost bound to lead to cashflow issues. They expect the full DD amount to be taken, as that is what they requested on account opening

It seems I am expecting too much and both Halifax & Santander just state that the DD system is working the right way in thier eyes.

Thoughts & comments all pls

MorningcoffeeIV

Some do this, so you just need to choose a card provider that doesn't reduce the DD. Job done.

Many people complain about the full DD being taken, so they want the sort of lender you currently use.

k_man

I have requested that a moderator merges this with your previous thread:
https://forums.moneysavingexpert.com/discussion/6424063/credit-card-full-direct-debit-amount-not-taken#latest

The_Don_13

grumbler said:

Yes, this is a common practice that manual payments and refunds made after the statement was produced usually reduce the DD unless they are made very close to the DD date.

Anyone else think this practice is crackers?....the full DD amount from previous months statement should be claimed by the bank etc each month, regardless of any refunds, manual balanc transfers etc.

With regard to refunds - maybe, but certainly not for manual payments.

Ok, I can see it maybe for manual patyments (in our case a balance transfer request to an interest free card) but not for just bog standard refunds that ae simply canceling out the original debit

The_Don_13

grumbler said:

Many people even abuse/exploit this. Instead of making minimum payments they buy and return things for a refund.

Not that I'm a big fun of people making minimum payments, not full.

Yes, its certainly not a case of trying to "cheat" the system at all. We always make full paymentsof the previous months statements but this system seems designed to imo sneakily encourage not paying full amounts owed

The_Don_13

eskbanker said:

Doesn't seem 'crackers' to me, no, and there have been posts before from cardholders who were outraged with providers who do take a DD based on statement balance without adjusting for refunds, so if that's how you'd prefer it to be, use one of the cards that works that way (they're not all the same).  I don't recall which do and don't, but you might find more info on the credit card board....

Ok,I would rather they take the full amounts owed for simple transparent cashflow reasons. I might change to ones that ignore any refunds/credits then, as I was thinking as both Halifax & Santander work that way, they all must do!