Credit card direct debit failed - what are my rights

richardadc

My Barclaycard monthly payment was due to be taken from my Monzo account on 20th October, and I got a notification from Barclaycard yesterday (24th) saying my direct debit has been cancelled. Taking a look at my Barclaycard, the direct debit payment request was returned and as such I've received a late payment charge (and i imagine a late marker sent to all the CRA).

Now normally i would pay my Barclaycard manually, but I've been extremely busy recently and as I knew I had DD setup for all my CC i wasn't concerned. This is the first time the direct debit for my Barclaycard would have been used (setup in 2021), but my Barclaycard statement has always said that the minimum payment would be taken by DD.

On talking to my bank (Monzo) they've said the DD is inactive, but hasn't been cancelled by Monzo, me, or Barclaycard.  It also doesn't appear in my DD list. I'm assuming this means a system error, and they've said that I can refer it to their complaints team (which I've done).

My question is; where do I stand on getting this resolved. Barclaycard count it as I haven't paid on time, but the fault for this seems to be with Monzo. Is there anyway to get Barclaycard to correct this issue based on me not being responsible for the issue?

I've seen Financial Ombudsman decisions where the fault lays with company supposed to be setting up the DD and being found in the customers favour (by removing late markers, charges etc), but couldn't find anything where the fault lays with the bank supposed to be receiving the DD instruction.

eskbanker

richardadc said:

This is the first time the direct debit for my Barclaycard would have been used (setup in 2021)

richardadc said:

On talking to my bank (Monzo) they've said the DD is inactive, but hasn't been cancelled by Monzo, me, or Barclaycard.  It also doesn't appear in my DD list. I'm assuming this means a system error, and they've said that I can refer it to their complaints team (which I've done).

No, direct debit mandates will automatically become dormant if unused for two years, so that's unlikely to be either party's fault....

https://www.directdebit.co.uk/faqs/inactive-direct-debits/

Bigwheels1111

Im not sure if i had the same issue.

I pay my Barclaycard off once the item has arrive, or a few days later.

Had not paid by DD for a long time.

One month I wanted it to pay by DD as was 2k and I wanted a few weeks extra to pay.

So my DD payment was not made, contacted them 2 days after it failed.

Told them its their fault not mine as DD is in place.

They took payment over the phone and later checking my credit file no markers were placed or extra fee charged.

Turns out that if the DD has not been used for 12 months it sort of drops off the system.

Can't be used in simple terms.

born_again

Most DD's will stop after 13 months of not taking any funds. Note they will still show in bank account etc.

All you can do is ring CC & explain. If it has not happened before, then they should waive the fee. 

retiredbanker1

Yes probably they would fail if a payment has not been taken within the last 13 months - my advice is to cancel them and then set them back up ready to be used.
Personally I would let the DD do its work if it has been set up - much handier than doing manual payments.

CliveOfIndia

richardadc said:

retiredbanker1 said:

Yes probably they would fail if a payment has not been taken within the last 13 months - my advice is to cancel them and then set them back up ready to be used.
Personally I would let the DD do its work if it has been set up - much handier than doing manual payments.

I've got a long interest fee period with Barclaycard so generally just pay above the minimum amount to avoid the minimum payment marker. Looks like I may not be able to do this going forward with Barclaycard as unlike other CC's, they don't seem to still take the entire minimum payment by DD if you don't clear the entire balance.

If you've got a DD set up for minimum payment then they will take the minimum payment - as long as the DD is active.  Paying just the minimum is not such as issue if you've got a 0% promotional deal, it will be marked as such on your credit file. 

molerat

born_again said:

Most DD's will stop after 13 months of not taking any funds. Note they will still show in bank account etc.

All you can do is ring CC & explain. If it has not happened before, then they should waive the fee. 

DD dormancy is now 24 months.  It was changed from 13 months during lockdown and has not been reset.

https://www.directdebit.co.uk/faqs/inactive-direct-debits/

dreaMer001

molerat said:

born_again said:

Most DD's will stop after 13 months of not taking any funds. Note they will still show in bank account etc.

All you can do is ring CC & explain. If it has not happened before, then they should waive the fee. 

DD dormancy is now 24 months.  It was changed from 13 months during lockdown and has not been reset.

https://www.directdebit.co.uk/faqs/inactive-direct-debits/

Now the above link redirects to: https://www.directdebit.co.uk/help/ and doesn't show anything about dormancy period.

According to an investigator at the Financial Ombudsman Service (FOS) the dormancy period is 31 months:

eskbanker

....but the thread had become dormant, ten months after anyone last posted on it!

dreaMer001

eskbanker said:

....but the thread had become dormant, ten months after anyone last posted on it!

10 months isn't that long. Less than the earlier Direct Debit dormancy period of 13 months!!!