too good to be true?-direct debit setup same day or 1 working day?

dreaMer001

So, I setup a Direct Debit (DD) to pay my Tesco Clubcard credit card using Kroo current account. This was setup on Wednesday 27 September.

My Tesco Club card statement which has date 27 September and became available to download yesterday (Thursday 28 September) says:

We will collect your full balance direct debit of £1,293.44 on 17/10/2023 or soon after.

From that it clearly indicates the DD has been setup. Anyone experience fast as lightening DD setups like this with Kroo (or another Bank for that matter).

Maybe worth keeping an eye if the DD is actually deducted next month (October), and if not, then making a manual payment I guess. My payment due date is 22 October.

Will keep you updated on what happens (with DD).

MorningcoffeeIV

So yes, the DD will be taken. 

There would only be a query over it if you were amending the details of an already established DD.

Rob5342

Three weeks isnt what I'd call lightning fast. It does say "or soon after", which I'd take to mean it could be later if it doesn't filter through the system in time.

MorningcoffeeIV

It's the one day which is fast.

The notification period for taking it has to be 10 days or more and the collection date is driven by the payment due date 

The 'or later' bit is standard and allows for internal issues. It's nothing to do with the DD not 'filtering through' .

Zanderman

Am I missing something here? 

Surely if you authorised Tesco to take money from Kroo by DD, then Tesco have that authority instantly.

The delay with new DDs isn't giving the authority.  It's the implementing of it.  That takes time.

So Kroo won't know yet there is a DD set up - but Tesco do, instantly, because you set it up with them.  That's not remarkable but expected.

To use another example, PayPal will set up DDs instantly. After set-up (during which they take the precaution of sending a token payment to the account to check its yours) the DD is listed on your PayPal account instantly. It's not unusual.

Rob5342

MorningcoffeeIV said:

It's the one day which is fast. .

It just means Tesco have initiated a direct debit setup and can say when the first payment will be knowing how long the process takes. It doesn't mean it's been confirmed by any bank. When I switched energy supplier they showed the direct debit details and payment date immediately, but it didn't show up in Monzo for a week.

dreaMer001

Zanderman said:

Am I missing something here? 

Surely if you authorised Tesco to take money from Kroo by DD, then Tesco have that authority instantly.

The delay with new DDs isn't giving the authority.  It's the implementing of it.  That takes time.

So Kroo won't know yet there is a DD set up - but Tesco do, instantly, because you set it up with them.  That's not remarkable but expected.

To use another example, PayPal will set up DDs instantly. After set-up (during which they take the precaution of sending a token payment to the account to check its yours) the DD is listed on your PayPal account instantly. It's not unusual.

 I see. So, the setup can be instant, but it's the debiting that takes AT LEAST 5-6 working days?

I have another tesco clubcard credit card which I'm paying the minimum ppayment. As a test, I could amend that DD to full payment close to the Debiting date, then see what happens. 

With Santander, in August I ammended DD on 9 August. My payment was due to be debited on 29 August. I contacted support and asked if I need to make a manual payment as only the minimum payment was covered by the DD (according to the previous statememt). Support said yes I need to do that (until my next statement confirms full payment will be taken by DD). But come the payment debiting date, the DD debited the full amount (as amended on 9 August).

So, If I do something similar with the second clubcard but leave only three working days until the DD is due to be debited, then see if the full amount is debited from Kroo account, we can see if the actual debiting is any quicker compared to the norm.

antuk

dreaMer001 said:

Zanderman said:

Am I missing something here? 

Surely if you authorised Tesco to take money from Kroo by DD, then Tesco have that authority instantly.

The delay with new DDs isn't giving the authority.  It's the implementing of it.  That takes time.

So Kroo won't know yet there is a DD set up - but Tesco do, instantly, because you set it up with them.  That's not remarkable but expected.

To use another example, PayPal will set up DDs instantly. After set-up (during which they take the precaution of sending a token payment to the account to check its yours) the DD is listed on your PayPal account instantly. It's not unusual.

 I see. So, the setup can be instant, but it's the debiting that takes AT LEAST 5-6 working days?

I have another tesco clubcard credit card which I'm paying the minimum ppayment. As a test, I could amend that DD to full payment close to the Debiting date, then see what happens. 

With Santander, in August I ammended DD on 9 August. My payment was due to be debited on 29 August. I contacted support and asked if I need to make a manual payment as only the minimum payment was covered by the DD (according to the previous statememt). Support said yes I need to do that (until my next statement confirms full payment will be taken by DD). But come the payment debiting date, the DD debited the full amount (as amended on 9 August).

So, If I do something similar with the second clubcard but leave only three working days until the DD is due to be debited, then see if the full amount is debited from Kroo account, we can see if the actual debiting is any quicker compared to the norm.

3 days wont be long enough, the usual timescale is 10 working days as stipulated by the Direct Debit Guarantee - any less than that you can object and the bank is liable. If its a change you have requested then sometimes they do it sooner than the 10 working days however there is still a few days processing time, so anything under a week is unlikely to take effect until the following month/payment cycle

sheramber

17/10/23 is 20 days after instrucitng Tesco aboutt he DD, so plenty time ti action it.

phillw

antuk said:
any less than that you can object and the bank is liable.

The bank isn't liable as such, they refund you and get the money back from the account of the company that took it.

The bank never knows whether you had 10 days notice or not & you still owe the money. You could end up with a missed payment being flagged up on your credit file if you recall a DD on a credit card.

antuk

phillw said:

antuk said:
any less than that you can object and the bank is liable.

The bank isn't liable as such, they refund you and get the money back from the account of the company that took it.

The bank never knows whether you had 10 days notice or not & you still owe the money. You could end up with a missed payment being flagged up on your credit file if you recall a DD on a credit card.

The bank is liable as in it has an obligation to return the funds to you. How it recovers the money is irrelevant and if it cannot or it takes time to retrieve these funds then it doesnt affect you. Hence the bank is liable...